Joel Ajayi 
The Federal Government has said the apocalyptic scenarios on thecountry’s debt profile, as painted by former Vice PresidentAtiku Abubakar in his press statement on Tuesday, is nothing butscaremongering anchored on a false premise.

In a statement issued in Abuja on Wednesday, the Minister ofInformation and Culture, Alhaji Lai Mohammed, said while the FederalGovernment welcomes constructive criticism, such must be based onverifiable facts rather than conjectures and innuendos.

”There is no doubt that former Vice President Atiku Abubakar lovesour country and wishes it well, otherwise he would not have sustained his serial quest for the country’s highest position. One can only hope that his resort to the use of such words as ‘precipice’, ‘foreclosure’ and ‘economic ruin’ does not reflect anything but best wishes for the country at this time,” he said.

Alhaji Mohammed said the figure of Nigeria’s debt to revenue ratio of99% in the first quarter of 2020, quoted by the former Vice President,is not in the Medium-Term Expenditure Framework and Fiscal Strategy Paper, where he claimed he got it from.
”We are also not able to ascertain the source of the first quarterfigures of N943.12 billion for debt servicing and N950.56 billion forretained revenue, which he also quoted,” he said.

The Minister said the debt service provisions in the annual budgetsinclude principal repayments, interest payments and all other applicable charges, adding: ”Therefore, the statement that debt servicing does not equate to debt repayment is not only wrong, but ill-informed.”

On the former Vice President’s assertion that revenue needs to go up, he said this Administration has introduced several measures to shoreup revenues, listing some of the measures as the passage andimplementation of the Finance Act, 2019, various on-going reforms inthe Oil and Gas, Tax Administration and Collections, as well as theStrategic Revenue Growth Initiatives.

Furthermore, Alhaji Mohammed said, since Nigeria’s debt service isexpressly provided in the annual budgets and the debt service payments are made as and when due, the issue of creditors foreclosing onNigeria, as strangely predicted by the former Vice President, does notarise.

He said contrary to the statement credited to Alhaji Abubakar thatNigeria has experienced alarming and unprecedented increase in theratios of debt to GDP and debt service to revenue, indeed, Nigeria’sratio of debt to GDP is one of the lowest in the world at 19.00% as atDecember 31, 2019, while Government is making concerted efforts to increase revenue so as to bring down the ratio of debt service to revenue.

”One of the reasons why debt service to revenue is high is becauserevenue generation in Nigeria has been low, with over-dependence onthe oil sector. This is corroborated by the fact that the ratio ofNigeria’s tax revenue to GDP is one of the lowest in the world atabout 6%,” the Minister said.

He said unlike what obtained in the past, when the nation borrowed toservice the crass indulgence of a few fat cats, the loans being obtained by the current Administration are beingprimarily used to finance infrastructure projects, which includeroads, railways, bridges and power, and the loans are long-term innature, which would benefit present and future generations.

”We have said that in the face of massive infrastructural decay, noresponsible government will sit by and do nothing. ThisAdministration’s borrowing, therefore, is aimed mostly at revampingour infrastructure. The loans for theeducational sector will contribute to the development of our humancapital while the loans for the agricultural sector will help the moveto diversify the economy,” Alhaji Mohammed said.

He said despite the negative impact of the Covid-19 pandemic on thecountry’s economy, the Federal Government has continued to takemeasures to mitigate the effects of the pandemic, and assured that theGovernment will always act in the best interest of Nigerians.

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