The former Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, has stated that Nigeria can still service its N46trn debt.
According to The PUNCH, she stated this while speaking at her valedictory ceremony in Abuja.
“Despite revenue challenges, government consistently met its debt service commitments, while post-financing assessments showed adequate capacity to repay loans,” she said.
Also, speaking at the launch of the World Bank’s Nigeria Development Update titled, ‘The urgency for business unusual’, the finance minister admitted that Nigeria struggled to service its debt.
She said, “Already, we are struggling with being able to service debt because even though revenue is increasing, the expenditure has been increasing at a much higher rate, so it is a very difficult situation.”
The World Bank also stated in the ‘Macro poverty outlook for Nigeria: April 2023’ brief that Nigeria’s chronic fiscal deficit has deteriorated the nation’s public debt stock, with 96.3 percent of government revenue spent on debt servicing in 2022.
In a separate analysis, the Washington-based bank predicted that debt servicing will consume 123.4 percent of federal revenue in 2023.
The finance minister noted in her farewell speech that the previous eight years had been eventful and characterised by the impact of two recessions caused by the 2016 oil price collapse and the 2020 COVID-19 pandemic.
Despite these obstacles, she emphasised the importance of timely monetary and fiscal measures to the economy’s recovery.
Ahmed emphasised the ministry’s work over the last eight years, saying she oversaw the adoption of “far-reaching measures to contain the adverse impact of the pandemic on citizens, as well as to resuscitate the economy.”
She stated that the administration used “a variety of fiscal instruments, such as tax relief measures, to alleviate the burden on businesses and vulnerable households.”
She stated that the next finance minister must think creatively in order to address the economic issues he or she will face.
Economic diversification, she noted, “Remained a key priority for Nigeria. Consequently, our development plans encompassed initiatives for developing supportive infrastructure and reforms aimed at reducing dependency on oil, alleviating inequality and unemployment, establishing robust and effective institutions, and addressing governance issues.”