Financial Experts Optimistic Despite Rising Public Debt Stock: No Cause for Alarm, Say Analysts
Financial Experts Optimistic About Nigeria’s Rising Debt Profile
Financial experts have expressed optimism that there is no cause for alarm over the country’s current debt profile. In separate interviews with the News Agency of Nigeria (NAN) in Lagos, experts shared their views on Nigeria’s rising public debt stock.
Samuel Agbelaye, the President of the Chartered Institute of Taxation of Nigeria, reassured Nigerians that there is nothing wrong with obtaining loans if they are used judiciously for developmental projects. He emphasized that the loans should not be used for overhead but for purposes that will add value to the economy.
Dr. Muda Yusuf, the Chief Executive Officer of the Centre for Private Enterprises, acknowledged the necessity of borrowing for the country but highlighted the importance of utilizing foreign loans for specific projects. He also suggested that the government could reduce the need to borrow by increasing oil and gas output.
Okechukwu Unegbu, former President of the Chartered Institute of Bankers of Nigeria, urged the government to explore more private equity financing for key infrastructure projects to avoid further raising the country’s public debt stock. He emphasized the need for the government to cut down on ostentatious spending to free up funds for developmental purposes.
The Federal Government is proposing to incur more loans from international developmental partners, with the World Bank set to provide a loan of $2.5 billion for economic stabilisation and resource mobilisation reform programmes. The country’s total public debt stock has surged to N97.34 trillion as of the first quarter of 2023, comprising both domestic and external debts of the Federal Government, state governments, and the Federal Capital Territory.
Despite the challenges posed by the country’s debt burden, experts believe that strategic borrowing and innovative financing solutions can help Nigeria address its developmental needs without compromising its economic stability. As the government navigates its borrowing strategy, the focus remains on ensuring that loans are used effectively for sustainable growth and development.