Nigeria’s Foreign Debt Hits $4.3bn

Nigeria’s foreign debt stood at 4.3 billion dollars as at March, with the domestic debt profile hitting N2.4 trillion, the Minister of Finance, Mr Olusegun Aganga, said in Abuja.

Aganga gave the figures on Monday at a workshop on process and procedures for obtaining local and foreign loans by both the federal and state governments.

The workshop was organised by the House of Representatives Ad Hoc Committee on the Investigation of Foreign and Domestic Loans in collaboration with the Central Bank of Nigeria (CBN).

Nigeria’s foreign debt was 3.54 billion dollars at the end of 2004 before its exit from the Paris Club of creditors that year.

Aganga said the level of debt was still within the internationally accepted benchmark for measuring debt sustainability but warned that every reason for borrowing must be justified.

“We must get value for every kobo we spend on behalf of the Nigerian people,” he said.

The minister stressed that the country deserved excellent cash flow to effectively address its persistent problem of infrastructureal inadequacy.

According to him, Nigeria is 40 per cent above the internationally accepted benchmark. 

Also speaking, the CBN Governor, Malam Lamido Sanusi Lamido, said the idea of zero debt was incompatible with developmental ideals, explaining that Africa lacked the required funds to meet its infrastructural needs.

He stressed the need for the CBN and the Debt Management Office to coordinate their activities in the interest of the country’s foreign debt.

According to Lamido, little has been done by relevant authorities to check revenue leakages in the Nigeria Customs Service.

He said that unless these leakages were blocked, the problems the country was going through in terms of dwindling revenue would persist.

The CBN governor said there was no basis for the government to continue to subsidise petroleum products when a few persons continued to benefit to the detriment of other Nigerians.

“I will continue to talk about petroleum subsidy; there are just a few groups of people that enjoy to the disadvantage of others.

“Subsidy on petroleum is unnecessary; I do not believe that the subsidy is actually coming to Nigerians,” he said.

Lamido said that borrowing money to subsidise petroleum products was baseless as the proceeds went to “a small cabal” in the country.

Earlier, the Speaker of the House of Representatives, Mr Dimeji Bankole, who declared the occasion open, had said the workshop became necessary following the renewed spate of borrowings by the federal and state governments.

He said the National Assembly was worried about the lack of adherence to extant legislation governing public borrowing.

“ We are not on any mission to decree against borrowing, whether foreign or domestic, but we are persuaded that borrowing, where inevitable, should be functional, productive and backed by value and optimal cases self-liquidation,” he said.