Zainab Ahmed, minister of finance, says while government borrows to deliver on its promises, it is also mindful of rising debt burden, which eats up about 25 percent of the country’s annual earnings.
Ahmed said this in an interview with NAN on the side-line of the just-concluded IMF/World Bank meetings, which took place in Washington DC from April 9 to April 14.
Nigeria had an external debt stock of about $24.27bn as of December 31, 2018.
Euro bonds, loans from World Bank Group, China and Africa Development Bank Group make up over 80 percent of the country’s debt stock.
Ahmed said in spite of warnings by the IMF and World Bank, the country was not in any way near a debt crisis.
“The World Bank and IMF are cautioning us on the rate at which we are borrowing. They are also cautioning us on the need to build fiscal buffers because the global economy is going to be facing some risks and we agree with that,” she said.
“We are very mindful of the level of our borrowings. Our borrowing is very much within fiscal limits right now.
“What we are doing is to increase our revenue generating capacity to make it easier for us to meet our debt obligations and our routine as well as capital expenditure.”
Responding to concerns on Chinese loans to finance the Idu-Kaduna, Lagos-Ibadan and Abuja light rail projects, expansion of four airport terminals and some hydroelectric projects across the country, Ahmed said: “To borrow, we go through several processes of assessments as well as negotiations.
“We make sure we get the best possible terms and whether we are borrowing from financial institutions or in Europe or China or anywhere else, we try to get the best rates of borrowing. So far, the conditions we’ve got are very good ones.”
She said the government of President Muhammadu Buhari is committed to ensuring that the country grows in a manner that would bring many people out of poverty.
According to her, it is for this reason that the government takes its social investment programmes like the school feeding, Conditional Cash Transfers to the poor and vulnerable and TraderMoni programme, very seriously.
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