With only 17 days left in his term and a new loan request of $800 million from President Muhammadu Buhari, an economist named Dr. Muda Yusuf has voiced grave worries about the administration’s economic operations, warning that they might send Nigeria into a terrible catastrophe.
Yusuf, the Centre for Promotion of Private Enterprise’s Chief Executive Officer, made this announcement on Friday during a breakfast television programme on Arise Television, which was shown in Abuja.
Yusuf stated that while Nigeria’s public debt was around N46 trillion at the end of last year, it may reach N80 trillion by the end of this year.
“The debt and revenue situation is something that is very frightening, and it is like an economy that is almost on the verge of collapse, an economy that is probably battling the issue of insolvency,” he added. That is the case because we are progressively approaching a point when we are using all of our income to pay off debts.
“We are nearly there, and because the national debt was N46 trillion as of the end of 2022, things may even grow worse. Now that the “Ways and Means” have been securitized, the Debt Management Office DMO has informed us that we would be discussing an amount close to N77 trillion.
There have also been several borrowings between January and the present, whether from the CBN or elsewhere. We thus anticipate approaching N80 trillion by the end of this year.
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He claims that the debt service portion of the 2023 budget was roughly N6.3 trillion even before the securitization, while the total income was N10 trillion.
“Remember, we hardly ever achieve 100% performance in revenue,” he remarked. You must thus reduce it by perhaps 20 or 30 percent. Therefore, the situation is very terrifying, and it is clear that we cannot afford to go in this manner.
To prevent the collapse of the entire system, something must happen immediately and promptly. It is a really worrying position, and if things continue as they are, our debt service component expenditure may reach around N10 trillion by the end of the year.#
Additionally, the economist bemoaned the lack of openness around government borrowing, particularly from the Central Bank of Nigeria CBN.
He said that strong measures must be done to prevent the country from falling under the control of the IMF, which would be more difficult.