With President Muhammadu Buhari’s request for an external debt borrowing plan, the spectre of at least an additional $25 billion to the country’s already fat debt portfolio stares the country in the face.
\nIf the National Assembly gives approval, and the loans are taken, the country’s debt profile is bound to shoot above N32 trillion in the coming years.
\nRecall that almost exactly three years ago, the Senate unanimously rejected a presidential request to the National Assembly to approve external borrowing plan of $29.960 billion to execute key infrastructural projects across the country between 2016 and 2018.
\nOn Thursday, the President made a similar request in a letter, though he did not state an amount. The letter suggested there is an attached list of projects the borrowing plan is for, but noted that some of the loans for projects had been approved by the former Senate.
\nThe non-attachment of the projects three years ago led to its been thrown out by the Senate.
\nIn November 1, 2016, according to a media report , President Buhari made the requests in two separate letters to the President of the Senate, Bukola Saraki, and Speaker of the House of Representatives, Yakubu Dogara.
\nBut when the request came up for consideration at the Senate, the lawmakers rejected the proposal entirely.
\nSenate Leader then, Ali Ndume, had asked the Senate to consider the request of the president for the huge loan.
\nBut when the Senate President, Bukola Saraki, put the request to a voice vote, senators responded with a resounding \u201cnay\u201d.
\nThe Senators maintained that position when Saraki put the question the second time.
\nIn his 2016 letter, the President said the external loan, the biggest in Nigeria\u2019s history, will fund targeted projects cutting across all sectors with special emphasis on infrastructure, agriculture, health, education, water supply, growth and employment generation.
\nOther sectors, he said, included poverty reduction through social safety net programmes and governance and financial management reforms, among others.
\nAccording to him, the cost of the projects and programmes under the borrowing (rolling) plan is $29.960 billion.
\nThis is made up of proposed projects and programmes loan of $11.274 billion, special national infrastructure projects $10.686 billion, Euro bonds of $4.5 billion and Federal Government budget support of $3.5 billion.
\nThe opposition Peoples Democratic Party then urged the National Assembly to reject the loan request.
\nSimilarly, lawyer and rights activist, Femi Falana, urged the lawmakers to reject Mr. Buhari\u2019s request, saying it would mortgage future generations of Nigerians.
\nA year later, the Senate, and subsequently the National Assembly, approved a request for $5.5 billion to execute some projects.
\nThe Senate Leader, Ali Ndume, according to a Premium Times report three years ago, later revealed that the president\u2019s letter had no detailed information about the nearly $30 billion loan bid, even though the letter made reference to an \u201cattached\u201d breakdown in its first paragraph.
\nThis was admitted by the Presidency through the President’s special assistant on the Senate, Mr. Ita Enang, who said the government would work with relevant agencies to collate the needed information.
\nSpeaking on the development then, the Senate spokesperson, Mr. Aliyu Abdullahi, said people entrusted with key responsibilities within the Presidency must do their work.
\nHe noted that there was a line in the letter that read \u201cattached\u201d, but lamented \u201cnothing is attached\u201d.
\nHe blamed the anomaly on officials who were responsible for helping the President on matters of communication.
\n\u201cThis is the reality unfortunately. We have to rethink position given to certain persons and people who are not competent should step aside.
\n\u201cWhat is the Chief of Staff doing? What is the SGF doing?
\n\u201cWe have said it that some people are working to set the president against the legislature,\u201d said Abdullahi.
\nDefending the Senate\u2019s action, the spokesperson said since the president\u2019s letter was not supported by detailed information, the lawmakers had nothing to work with.
\nMr. Abdullahi however said \u201cif all these things are addressed, the Senate is more than desirous\u201d to consider the loan authorisation request.
\nAs that time, the country’s debt profile was N16.29 trillion, representing $61.7 billion at N283\/$1 exchange rate, according to the Debt Management Office.
\nAccording to The Guardian last October, the nation\u2019s debt profile rose from N24.95 trillion to N25.7 trillion in the last three months. One year ago, it was N22.38 trillion.
\nThe development showed that between April and June, the country\u2019s obligations rose by N750 billion, and increased by N3.32 trillion when compared with the debt figures as of June 30, 2018.
\nGovernment has, so far, paid more than N800 billion in servicing the multiple obligations, which cut across domestic and foreign deals in the first half of 2019.
\nTotal domestic debts stood at N17.38 trillion, with the Federal Government having more than three-quarters of the stockpile. These include FGN Bonds, N9.69 trillion; Nigerian Treasury bills, N2.65 trillion; Promissory Notes, N708 billion; FGN Sukuk, N200 billion; Nigerian Treasury Bonds, N126 billion; Green Bond, N26 billion; and FGN Savings Bond, N10.4 billion.
\nOn the other hand, the external debt components are made up of multilateral deals worth $12.7 billion; bilateral, $3.3 billion; and commercial, $11.2 billion. Among these external debt obligations, the World Bank Group, China and Eurobond are top creditors, with over $23 billion claims on the country.
\nOn Thursday, the President sought the re- consideration and approval of the National Assembly on the 2016-2018 External Borrowing Plan of the Federal Government.
\nIn it, he wrote: \u201cPursuant to Section 21 and Section 27 of the Debt Management Office Establishment Act, I hereby request for resolution of the Senate to approve the Federal Government\u2019s 2016 and 2018 external borrowing plan as well as relevant projects under this plan.
\n\u201cSpecifically the Senate is invited to note that while, I had transmitted the 2016-2018 external borrowing plan to the 8th National Assembly in September 2016, this plan was not approved in its entirety by the legislature.
\n\u201cOnly the Federal Government\u2019s emergency projects, for the North-East\u2019s four states projects and one China Exim Bank assisted railway modernisation project for Lagos-Ibadan segment were approved out of a total of 39 projects.
\n\u201cThe outstanding projects in the plan that were not approved by the legislature are nevertheless critical to the delivery of government policies and programmes relating to power, mining, roads agriculture, health, water and educational sectors.
\n\u201cThese outstanding projects are well advanced in terms of their preparation consistent to the 2016 debt analysis undertaken by DMO and were approved by the Federal Executive Council (FEC) in August 2016 under the 2016-2018 external borrowing plan.
\n\u201cAccordingly, I have attached for your kind consideration, relevant information from the Honourable Minister of Finance Budget and National Planning, the specific outstanding projects under the 2016 -2018 external borrowing plan for which the legislative approval is been sought.
\n\u201cI have also directed the minister to make herself available to provide any additional information or clarification which you may require to facilitate prompt approval of the outstanding projects under this plan.
\n\u201cWhile, hoping that this request will receive the usual expeditious consideration by the Senate, please accept distinguished Senate President, the assurances of my highest consideration,\u2019\u2019 the letter stated.<\/p>\n","protected":false},"excerpt":{"rendered":"
With President Muhammadu Buhari’s request for an external debt borrowing plan, the spectre of at least an additional $25 billion to the country’s already fat debt portfolio stares the country in the face. If the National Assembly gives approval, and the loans are taken, the country’s debt profile is bound to shoot above N32 trillion […]<\/p>\n","protected":false},"author":7,"featured_media":16561,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,5777,7],"tags":[31,277,142],"class_list":["post-22685","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","category-features","category-news","tag-buhari","tag-debt","tag-senate"],"_links":{"self":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/posts\/22685","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=22685"}],"version-history":[{"count":0,"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/posts\/22685\/revisions"}],"wp:attachment":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=22685"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=22685"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=22685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}