“All of government’s borrowings were targeted at infrastructural development. Without borrowing, we won’t be able to deliver on the budget and I think we should be clear about that and a lot of that went into capital projects," Oniha said.
The Director General of the Debt Management Office, Patience Oniha, says the Federal Government has to borrow to be able to finance the 2018 budget.
She said this while speaking on Monday at the public presentation of the spring 2018 issue of the International Monetary Fund Regional Economic Outlook for Sub-Saharan Africa.
According to Oniha, Nigeria, although an oil-producing nation like Saudi Arabia, cannot cmpare itself with the western Asian country.
“We have since realized we should not be benchmarking ourselves against these countries. We borrow because there is a revenue shortfall," she said.
“The National Assembly passed the budget last week and we know it was higher than what the executive presented. So, as a debt manager, what I am looking for is to see where the funding of that incremental size may come in from.
“All of government’s borrowings were targeted at infrastructural development. Without borrowing, we won’t be able to deliver on the budget and I think we should be clear about that and a lot of that went into capital projects."
However, the senior Resident Representative of the International Monetary Fund, Amine Mati, who also spoke at the public presentation, expressed concern over Nigeria’s capacity to repay its debts and stressed the need for the Federal Government to mobilize more revenues domestically.
“The number of countries in debt distress has increased. From six countries in 2014 to eight in 2015, to 10 in 2016, and today 15 countries. These are low-income economies," she said.
“Now, I know the question that is going to come from here is: Where is Nigeria? Nigeria is not considered a low-income economy. Nigeria’s debt stock figure, which is 20 to 23 per cent of Gross Domestic Product, is still quite low by any standard. The issue is capacity to repay the debts. So, interest payment to revenue is an issue."
It will be recalled that Nigeria recorded a total debt of N21.73 trillion at the end of 2017.