Between 2015 and March 2019, Nigeria’s external debt profile suddenly grew from $10.32 billion to N24.947 trillion or $81.274 billion, former president, Olusegun Obasanjo, said on Friday, December 27.
Obasanjo also warned that the country was currently sinking under this external debt adding that something urged needed to be done to save future generations from bearing the brunt.
This is aside the $29.6 billion loan the federal government seeks to secure, he said.
Obasanjo issued the warning concerning the effect of such massive borrowing when he spoke at an event, the ‘why I am alive campaign’ organised by Nigerian pastor, Itua Ighodalo, in Lagos on Friday, December 27.
The former president, who governed the country between 1999 and 2007, shared his experience with borrowing as an individual and on behalf of the country.
In the speech, he painted a gloomy future for Nigeria should its leaders not take a fresh look at their steps in relation to loans.
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Obasanjo, who expressed pity on the future generations of the country, argued that even though securing loan for well-thought-out projects could be positive, it is lamentable that Nigerian leaders do not have the required discipline.
“In this case, the issue of Nigeria rapidly sinking under the weight of debt; both foreign and domestic, should bother us all.
“Everyone knows that our governments are notoriously deficient in serious and adequate discipline and most often lack competence and consistency as well,” he said.
Concerning the current huge debt burden on Nigeria, Obasanjo said the current situation could be likened to heading for bankruptcy.
To service this current level of indebtedness, we must commit at least 50% of our foreign earnings!! Such a situation talks about an impending bankruptcy. No entity can survive while devoting 50% of its revenue to debt servicing. It has recently been pointed out that in 2018 that total debt service cost took over 60% of government revenue.
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What is more we are not doing enough to address the fundamental, deep-seated and structural challenges that inhibit the expansion of our economy. As if this is not bad enough, we are currently seeking to add another $29.6 billion loan to our already overburdened debt portfolio.
Our current budget out of which we are spending 25% to service debt is not our total earning; a lot of it is also borrowing. Simply put, we are borrowing to service what we have borrowed and yet we are borrowing more.
I do not need the brain of any genius to conclude that those who use statistics to dig us deeper into debt are our enemies. Statistics can be used to serve any purpose and that is why Winston Churchill talked of ‘lies, damn lies and statistics’ meaning statistics can be made master of lies.