Non-Interest Financing critical to funding amidst high debt service levels — Wale Edun

By Matthew Denis

The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun has stated that the country needs Non-Interest Financing  as a critical sector towards funding as the country is faced with high levels of debt servicing.

The Minister’s disclosure at the SEC Nigeria-Islamic Financial Service Board (IFSB) International Forum held in Abuja on Wednesday.

He said, “Non-interest financing is a critical part of funding and that is because as we all know, we are faced with three crises right now which are the climate, and biodiversity but there is also a debt crisis in major countries and of course, the available solution is non-debt, equity and financing mechanisms that will eliminate the pains of paying interest on loans. Rather, it is better to have a participatory opportunity that equity and non-interest finance gives.

“And so what we are saying here is a critical piece of the solution to the crises of the world currently, including the fact that for the rapid and inclusive growth this administration desires, we need to have green projects so we don’t only need to have projects funded by equity.

“As we all know, our debt service levels and revenue to debt service ratio are so high and currently constrained.”

The Minister stressed that there is fiscal exhaustion in many parts of the world and there is also a need to finance green projects.

“So the only way to grow our economy is not just relying on foreign direct investments, and domestic investments but tap into the world of non-interest financing.”