Nation
‘Nigeria’s External Debt-To-Revenue Up 400% In 10 Years’
Nigeria’s external debt to total revenue increased from 8 per cent in 2011 to 400 per cent in 2020, a former governor of the Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi, has said.
Sanusi lamented the situation while participating in an online roundtable discussion tagged, “Debt Relief for a Green and Inclusive Recovery in Nigeria”, organised by Heinrich Böll Foundation.
The former CBN governor said Nigeria has a debt services ratio of up to 90-96 per cent but there are certain other elements of debts that analysts have not paid attention to.
He said, “If you go through the CBN statistical bulletin, in 2011, the total federally collected revenue from all sectors was N18.9trillion at N165 to the dollar. This will have placed federally collected revenue in 2011 at $55.5billion.
“Meanwhile, debt at that time was $5billion, so, we had an external debt to external revenue of about 8 per cent in 2011. By 2020, we have an external debt of about $33.4billion but all revenues in 2020 were about $8.3billion. So, it has moved from 8 per cent to 400 per cent between 2011 and 2020.
“And this is a serious red flag that I’ve not seen being pointed out in the conversation around debt sustainability especially given the facts that exports are yet to be diversified at the book of our revenues from oil sectors given what we’ve seen and what have been discussed today about the prospect of hydrocarbons as we move into a greener world.”
Nigeria’s debt position has been a source of concern for development experts in recent years, especially in the midst of dwindling oil revenue.
Sanusi, who was recently deposed as Emir of Kano, noted that in measuring debt sustainability, the debt to Gross Domestic Product (GDP) ratio is a useless metric.
“You do not service debt out of GDP, you service debt out of revenues,” he said.
“If only 20 per cent of your GDP is paying taxes, if you have a debt GDP ratio of 20 per cent, you are likely to have a debt service to revenue ratio of 100 per cent.
“So, for a long time, I have been concerned about this idea that if (having) 25, 30 or 35 per cent debt to GDP ratio is fine, because you’ve got countries that are activating 90 per cent.”
He added that in the countries where debts to GDP numbers are high, tax is a major component of government revenues.
Sanusi also explained that high interest rates with high debts could lead to difficult financial situations.
He also explained further that another key part of the nation’s debt profile is the components of bilateral loans, of which China is a major player, with $3.2billion of Nigeria’s $4.1 bilateral debt, that’s about 78 per cent.
He explained that any talk about debt sustainability has to involve China as a very dominant player.
The former CBN governor agreed that the call for debt relief is in the right direction, but the nation needs to show serious commitment and review the structure of its government and economy.
He noted that as countries begin to lift Covid-19 restrictions on travels, there will be increased demand for forex on travel, further putting pressure on the country’s exchange rate.
“When the world reopens and people start travelling, that is going to lead to an increase in demand on forex for travel and that is going to exert further pressure on the balance of payments.
“Now, these are the kinds of considerations I think we need to bear in mind when we talk about the sustainability of a debt situation.
“Honestly, I think debt relief is very necessary if this country is going to have the fiscal space to pursue any kind of developmental objectives. We can’t be spending 90 or 100 per cent of our revenue on debt service and don’t have anything to invest in development.”
According to Sanusi, the country needs to invest in education and agriculture, stressing that these two sectors will help play a key role in lifting Nigerians out of poverty.
Part of the problem Nigeria faces, he said, is that there has been significant under-investment in education and health care, and the productivity of agriculture.
“And these are the kinds of things that we need to lift people out of poverty and bring sustainable growth,” he argued.
The former chief executive of First Bank also explained that the rapid rate of growth in population is a source of concern, adding that the country needs to have social policies around demographic growth.
“There are parts of this country where the fertility rate is more than eight (8) live births per woman, and again some societies are also polygamous,” he said.
“Now there’s no way that you are going to continue growing at 3.4 or 4 per cent when your economy is growing at a slower rate and expect to deal with poverty. And that is an unsustainable model.”
He also noted that setting up factories could help lead to economic growth.
He said, “One of the issues I have with people when they talk about removing the subsidy on electricity tariffs and how the tariffs are going to go on to avert some problems is that we worry so much about tariffs because we use electricity for consumption and the buck of the population is yet to understand that electricity is an import into production. You can’t burn it.
“So, if you take away the subsidy by having a cost recovery tariff, you could put that money into small and medium enterprises that will turn that electricity into real production of goods and services and lift people out of poverty.
“Now, it doesn’t have to be fossil fuels electricity, you can in the same way, for example, use these bonds to encourage setting up factories to produce solar panels. People talk about renewable energy but if you are going to be importing solar panels from China or the UK, it is not as effective as if you set up factories to produce these panels in Nigeria. You’ve got all the raw materials you need to produce solar panels.
“So, set up factories, produce these panels and then the subsidy come in, in form of making these panels affordable and the kind of financing you give to the micro-enterprises to turn this renewable energy into goods and services.
“Not just about producing renewable energy that will continue to be fuelling television sets, water kettles, video games, no; we want electricity so that micro, small and medium enterprises can begin to generate.”
Sanusi argued further that a very smart way of dealing with debt relief is to effectively ensure that government puts in the right policies and that money goes into the right areas that will lead to sustainable development.
He noted that what happened when debt relief was granted to Nigeria in the past was that Nigeria went back on spending on overheads, unnecessary petroleum subsidies, and subsidies on fertilisers, which has not helped the country.
“What happened in the past was that we had this debt relief and then we went back to borrowing money, spending on salaries, overheads, and unnecessarily petroleum subsidies all sorts of fertilisers sub discount and those are the kind things that need to end,” he lamented.
“But we also need to bear in mind that as we take them out, the way to minimise impact is to address the real SDGs considerations, education, healthcare, renewable energy accompanied by training, the productivity of agriculture and this is really about the policy deficit that we’ve had in the last few decades,” he said.
Nation
HYPREP Trains Students On Petroleum Jelly, Liquid Soap Making
In a bid to meaningfully engage secondary school students in Ogoniland during the Christmas holidays and beyond, the Hydrocarbon Pollution Remediation Project(HYPREP) has trained them on petroleum jelly and liquid soap making.
This is even as the Project has partnered with the National Orientation Agency(NOA) and the National Drug Law Enforcement Agency(NDLEA) to keep the students away from crime and other related social vices during the Yuletide, by giving them pep talks that would put them on their toes during the period.
This came to the fore as HYPREP recently organised an Ogoni Young Men Mentorship programme and life skill workshop with the theme, ‘Career Coaching: Developing The Young Minds’ at Birabi Memorial Grammar School, Bori, headquarters of Khana Local Government Area of Rivers State.
The beneficiaries of the programme are essentially members of environmental clubs in 13 schools in four local government areas of Khana, Gokana, Tai and Eleme.
At the event, both NOA and NDLEA gave career talks to the students, aimed at keeping them off social vices like drug abuse and addiction as well as negative peer influences through out the Christmas holidays and beyond.
Speaking at the event, the Project Coordinator of HYPREP, Prof NeinibariniZabbey said the Project deemed it necessary to invite the National Orientation Agency and the National Drug Law Enforcement Agency(NDLEA) to speak to the students in order to shield them from negative peer influences as they are preparing to go for the Christmas holidays.
He explained that the workshop would enable the students to know when the signs of the negative peer influences start coming.
Zabbey, who was represented at the occasion by HYPREP’s Head of Sustainable Livelihood, Mrs Josephine Nzidee, said the Project is not only going to train the beneficiaries but also give them the tools and skills that would grow them in the future so that they would start making money for themselves.
Also addressing the students, the Rivers State Coordinator of the National Orientation Agency(NOA), Mr Young Ayo-Tamuno expressed delight for meeting young minds, to discuss issues on values, describing it as a great opportunity.
He noted that there are seven values which constitute the role and commitment of the government towards the citizenry and another seven core values which constitute the code for the citizens.
While commending HYPREP for organising the event, Ayo-Tamuno said team work is key to making Nigeria a better place for all, as both the government and the citizens have their respective roles to play, with each staying committed and focused.
The Chief Programme Officer of NOA, Mr Henry Ayede was the one who actually mounted the rostrum and drilled the students on the seven core values embodied in the National Value Charter for citizens, and stressed the need for them to imbibe them and put them to practice as they grow up.
Ayede listed the values to include discipline, duty of care, leadership, tolerance and respect, transparency, environmental awareness and resilience.
He also underscored the need for the students to imbibe the spirit of hard work and dignity of labour, contending that while hard work and dedication contribute to success, every job can contribute to national development.
According to him, dignity in labour is the foundation of success.
On his part, Mr Bill Ebiokpo of the Media/ Advocacy Unit of NDLEA, who represented the Bori Area Commander of the agency, advised the students to guard against drug abuse and addiction, which he said have far reaching consequences.
The Principal of the Senior Secondary of Birabi Memorial Grammar School, Barrister Bob Agbozi thanked HYPREP for organising the programme, which he said enriched his knowledge and that of the students on the core values guiding the society, saying inculcating such values in young people and teaching them practical skills have contributed immensely to the greatness of advanced countries and even countries like Rwanda in Africa.
He noted that the career coaching would change the behavioral pattern of the students particularly during the Yuletide.
He also thanked NOA for the career talks and urged it to replicate the programme in other places, not only in schools but also in market places.
The training of the students on petroleum jelly and liquid soap making was anchored by an expert, MrsLekpa Abel, with HYPREP workers lending a helping hand.
It was, indeed, a practical session with the students, who came face to face with the production materials of the products.
Donatus Ebi
Nation
Community Organises Civic Reception For LG Boss
It was celebration galore as the people of Isu Community in Etche Local Government Area of River State held a civic reception in honour of the Council Chairman, Dr Uzodinma Nwafor .
The epoch- making ceremony which took place recently at the community ancestral home saw the attendance of the political class, the clergy, opinion leaders, the academia, youths, women, elders and chiefs gather to honour their brand new chairman.
In his remarks, the Chairman of Etche Local Government Council, Dr Uzodinma Nwafor expressed gratitude to the people for according him such honour, saying it shows their unwavering support to the development of Etche.
Nwafor announced the readiness of his administration to embark on electrification of Ozuzu clan including Isu community.
The Etche council boss also said the market at Isu will be reconstructed to improve the economic life of the people.
He revealed that the two projects will commence in January as efforts are on to mobilise the contractors.
Nwafor told the mammoth crowd that his major concern remains, peace and unity of the entire Etche, saying security of lives and property remains top on his agenda as no meaningful development can thrive in an atmosphere of violence.
He urged parents to encourage their wards and children to refrain from violence and embrace peace. “Let us allow Etche to be at peace .Don’t allow any body to use you set Etche ablaze. Parents advise your children to stay away from crime .We must stay in peace and unity. Our children must shun violence ,it can’t take us anywhere as a people ,” he declared.
He thanked the people for their support as well thank their son, former commissioner for Energy ,Okey Amadi for being a Pilar of his political sojourne.
Earlier, the Isu opinion leader and Principal, Community Secondary School, Mgbosomini in Obio/ Akpor Local Government Area, Mr Chijioke Amadi said the honour done Etche chairman was a collective division of his people.
Amadi described the council boss as an illustrious son who has contributed immensely to the wellbeing of the community.
He declared that his community and the entire Etche will keep supporting him because he is doing well.
Amadi urged the people to keep praying for him and the Rivers State Governor to succeed in delivering dividends of democracy.
Nation
Senate Summons Wike Over Demolition Of Houses …Set To Investigate FCDA Activities
Senate has set up an adhoc committee to investigate the demolition of buildings in the Federal Capital Territory, FCT by the Federal Capital Development Authority, FCDA, just as it summoned the Minister of FCT, Nyesom Wike, to appear before it to explain the reasons behind the demolitions, which have left many residents stranded
The resolutions followed a motion by Senator Ireti Kingibe ( FCT), who expressed concern over the illegal demolition of structures in the nation’s capital and called for an immediate stop to further demolitions.
The Red Chamber particularly ordered the FCDA to halt ongoing demolitions of property in the Territory within the next two weeks pending the report of its adhoc committee constituted to probe the issue.
The adhoc committee, to be chaired by the Deputy Senate President, Senator Barau Jibrin, has the Deputy Senate Leader, Senator Lola Ashiru; Chief Whip of the Senate, Senator Tahir Monguno, Senator Yahaya Abdullahi, Senator Sahabi Ya’u, Senator Victor Umeh, Senator Jimoh Ibrahim, Senator Idiat Adebule and Senator Jarigbe Agom Jarigbe, as members.
The Senate President, Senator Godswill Akpabio, who announced the composition of the committee, gave it two weeks to submit its report.
Akpabio while reading the resolution of the Senate, said: “The Senate urges the Federal Capital Development Authority (FCDA) to stop further demolitions of structures, except those ordered by courts of competent jurisdictions, until the adhoc committee constituted by the Senate to ascertain the propriety or otherwise of the exercise concludes its investigation and interface with the FCT administration within the next two weeks.”
Kingibe in her lead debate said that in recent times, the demolition exercise in the FCT was no longer based on reasons that necessitated the demolition.
She urged the Senate to be further concerned that the current demolition in the FCT was not in line with due process of court orders to demolish.
“As such, a cross section of individuals had suffered untold hardships occasioned by massive demolition, which has led to a loss of properties worth billions of naira.
“Also concerned that at the moment, an estate by name, Messrs Paulosa, for which late Colonel Paul Osakpawan Ogbebor is the chairman, is currently under revocation and demolition. And from reliable information, the said plot of land was allocated to him in 1984 with requisite title document.
“And further concerned that the owner of this estate was a patriotic Nigerian who served the nation meritoriously and one of the first intakes of the Nigerian Defence Academy, Kaduna, with registration Number 001,” Kingibe said.
She urged the Senate to accordingly resolve to urge the FCT administration to halt the ongoing revocation and demolition of the said property, “as it does not fall within the purview of the reasons for the massive demolition being carried by the FCDA.”
Senator Kingibe also advocated thatall demolitions should follow due process while the Senate set up a committee to investigate the matters arising from the demolition.
However, Senator Sunday Karimi ( Kogi West) in his contribution said the Senate needs to hear from the Minister of FCT, Nyesom Wike, before ordering a halt to the demolitions.
“If you look at this motion, the presenter said, a specific land allocation was mentioned belonging to one Paul Ogbebor.
“We don’t know anything about this thing and we are just coming because of this to tell the minister to stop?
“There is need to investigate this matter before giving any directive. We must hear from the minister. But we have to hear before we say stop demolition.
“Let’s hear from the Minister. You cannot shave a man’s head at his back. We need to hear from the Minister,” Karimi said.
The Chairman Senate Committee on Judiciary, Human Rights and Legal Matters, Senator Adeniyi Adegbonmire (Ondo Central), however disagreed with Karimi, saying that the request that the Senate should call on the FCT minister to halt further demolitions was in order.
He said: “Mr. President, with respect I disagree with Mr. Karimi. I think we need to be fair to everyone. There is before us an allegation that says certain steps are to be taken which will culminate in demolition. Are we saying that we should allow the place to be demolished while we are trying to look into it?”
In his response, the Senate President, Godswill Akpabio agreed with the chairman Senate Committee on Judiciary and Legal Matters, saying “my thought is in line with yours. If we just say, continue the demolition, and then we start investigation, what are we then investigating?”
He, thereafter, read the resolution of the Senate calling on the FCT Minister to halt further demolitions of property in the FCT pending the investigative report of its adhoc committee chaired by the Deputy Senate President.
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