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Nigeria, 72 Others At High Risk Of Debt Distress -IMF
A new report released by the International Monetary Fund (IMF) has said that Nigeria and 72 other countries are at high risk of debt distress.
The report, ‘Restructuring Debt of Poorer Nations Requires More Efficient Coordination’ was released in Washington, DC, United States.
“Low-income countries face fewer debt challenges today than they did 25 years ago, thanks in particular to the Heavily Indebted Poor Countries initiative, which slashed unmanageable debt burdens across sub-Saharan Africa and other regions.
“Although debt ratios are lower than in the mid-1990s, debt has been creeping up for the past decade and the changing composition of creditors will make restructurings more complex.
“Improvements to the Group of 20 Common Framework for Debt Treatments—from which the 73 countries that were eligible for the G20 Debt Service Suspension Initiative (DSSI) in 2020-21 can now benefit—could clear a path through this increasing creditor complexity.
“So far, only a handful of countries have requested to use the common framework, which was launched in November, 2020, underscoring the need for change to build confidence and encourage participation at a pivotal moment for heavily indebted low-income countries,” the report reads.
According to IMF, the debt ratios of DSSI countries have increased, partly reversing a decline seen in the early 2000s.
It added that this was spurred by low-interest rates, high investment needs, limited progress in raising additional domestic revenue, and stretched systems for managing public finances.
It said the economic shocks from the COVID-19 pandemic and the war in Ukraine were adding to the debt challenges faced by low-income countries, even as central banks begin to raise interest rates.
“About 60 per cent of DSSI countries are at high risk of debt distress or already in debt distress—when a country has started or is about to start a debt restructuring, or when a country is accumulating arrears.
“Among the 41 DSSI countries at high risk of or in debt distress, Chad, Ethiopia, Somalia (under the HIPC framework), and Zambia have already requested a debt treatment. Around 20 others exhibit significant breaches of applicable high-risk thresholds, half of which also have low reserves, rising gross financing needs, or a combination of the two in 2022.
“On the domestic side, difficult trade-offs will exist between the need to restructure sovereign debt owed to domestic banks, in some cases, and the impact of such restructurings on financial sector stability and the capacity of domestic banks to finance growth.”
The report of the international financial institution further stated that local currency debt for the median DSSI country doubled from seven per cent of Gross Domestic Product (GDP) in 2010 to 15per cent in 2021.
It stated that for those DSSI countries with market access, the share more than tripled from eight percent to 28per cent in 2021.
“Many of these DSSI countries have also experienced a tightening of sovereign-bank links, with larger holdings of domestic sovereign debt at domestic banks.”
On the way forward, IMF recommended putting in place mechanisms that ensure coordination and confidence among creditors and debtors.
It added that improvements to the G20 Common Framework could play an important role by ensuring broad participation of creditors with fairer burden-sharing.
“Experience so far shows that greater clarity on restructuring steps, earlier engagement of official creditors with the debtor and with private creditors, a standstill in debt service payments during negotiations, and specifying the mechanics of comparability of treatment, is still needed.
“Strengthening debt management and debt transparency should also be priorities. This would help countries manage debt risks, reduce the need for debt restructurings, and facilitate a more efficient and durable resolution if debt becomes unsustainable.
“It is in the interest of debtor countries as well as their creditors that debt restructurings, where necessary, are accomplished speedily, smoothly, and efficiently. This would support global stability and prosperity, too,” the financial institution proposed.
The Mayor of Housing, My-ACE China, has teamed up with a renowned hospital group in Port Harcourt, the Meridian Hospitals, which is in partnership with the Pilgrims Health Foundation, to carry out a one-day medical outreach last Tuesday.
The free treatment scheme took place at Oromenike Government Girls Secondary School in D-Line, Port Harcourt, with over 100 persons accessing free treatments, including free eye-glasses and booking for eye surgeries.
Other areas of treatment included general health consultations and treatment; blood pressure and sugar level testing; malaria testing and treatment; free prescriptions; preventive health talks focusing on hygiene, maternal health, and nutrition.
The scheme was conducted under the theme: ‘Bringing Healthcare to the Community.’
Newsmen who visited the venue of the scheme found that enthusiastic beneficiaries had thronged the area as early as 7a.m. After setting up, the medical team began attending to the patients.
Mr. Jerry Onwuso, a 63-year-old patient, who was first to see eye doctors and got eye glasses and drugs, told newsmen that he was pleased with the medical intervention.
He made it clear he did not pay any money to get all the treatments and glasses, and pleaded that the scheme be sustained.
Another patient, Loveth Sam, expressed satisfaction with the scheme and appealed to the sponsors to continue to increase the benefits.
Throwing some light on the scheme, Mr. China said he worked in Meridian Hospitals as a Lab. Scientist 19 years ago, but resigned because he could not bear to see patients struggling for life because they had no money to pay for treatment.
He said he came back to help extend free medical treatment to the less privileged.
Sources said China was always having issues with the hospital authorities when he would insist on critical patients being allowed to be treated first, with or without money.
Years later, China, who now goes by a brand name, the Mayor of Housing, returned to the Meridian Hospital headquarters to support free medical scheme.
He also went the next day to the headquarters of Meridian, after the one-day medical outreach, to give cash gifts and palliatives to workers he met when he worked there but had remained in service since he left.
He encouraged them to continue to give their all to humanity through the hospital. The Mayor of Housing called most of them by name and a cloud of emotions descended on them during the reunion.
Appreciating the gesture, the Founder and Chief Medical Director, Dr. Iyke Odo, said China had always manifested hard-work, ambition, and impulsive giving.
According to him, the then young bright boy was full of humanity, kindness, love, and made friends easily, adding that “not everybody that gives is a giver. The difference is that givers are given to give.”
Dr. Odo used the opportunity to call on governments to review Nigeria’s health insurance system and make it work in Nigeria to save lives.
He said it was sad watching critically sick persons abandoned because they did not have money for treatment.
He also condemned harsh tax and electricity tariffs whereby facilities like his now pay N12 million instead of N500,000 few years back.
He wondered why hospitals were being made to pay tariffs like oil companies, citing many other countries where medical facilities were placed on low rates and tariffs so they could charge moderate fees from patients.
The Renewed Hope Initiative in conjunction with the Rivers State Government has empowered 500 elderly citizens in Rivers State with financial support of N200,000 each.
The empowerment programme was part of activities to celebrate the third anniversary of the Renewed Hope Initiative Elderly Support Scheme RHIESS, a social investment policy initiated by the First Lady of the Federal Republic of Nigeria, Senator Oluremi Tinubu.
Speaking at the event which held at the Government House, Port Harcourt, recently, under the theme, ‘Finding Joy in Old Age,’ Senator Tinubu said the gesture which has become traditional since 2023 was a mark of gratitude in recognition of the invaluable contributions of the senior citizens to nation building.
The First Lady who was represented by the wife of the Rivers State Governor and State Coordinator of the Renewed Hope Initiative, Lady Valerie Fubara, said the scheme was to “support two hundred and fifty (250) vulnerable elderly citizens aged 65 and above in all the 36 states of the federation, the Federal Capital Territory, and veterans from the Defence and Police Officers’ Wives Association (DEPOWA) totalling 9,500 selected beneficiaries across the nation.
She urged the beneficiaries to engage in activities that will make them find joy in old age.
“I encourage you to continue playing your part by staying healthy and active, nurture both your body and mind through regular exercise and meaningful engagement,” Senator Tinubu advised.
On her part, Lady Fubara said the State Government through the magnanimity of the governor, Sir Siminalayi Fubara, has increased the beneficiaries of the programme from 250 to 500.
She restated the commitment of the State Government towards provision of social welfare and improving the standard of living of the elderly in the State.
Also speaking, the Executive Secretary, Rivers State Contributory Health Protection Programme (RIVCHPP), Dr Vetty Agala, said the State Government has through the Health4allrivers Initiative, introduced free medical care for senior citizens in the State, in line with the Renewed Hope Initiative.
