The Director General of the Progressives Governors Forum, Salihu Lukman has weighed in on the debate of Nigeria’s debt profile, saying issues around management of Nigeria’s foreign exchange by the Central Bank, a situation whereby the US Dollar would appear to be on a roller-coaster against the Naira is simply unacceptable.
Mr Lukman said so far, the debate about Nigeria’s debt is based on the absolute value of the amount Nigeria owe.
Salihu Lukman in a statement enumerated that, Variables of both Gross Domestic Product and revenue are ignored in the debate.
His words: “Without any doubt, some of the concerns expressed in the debate are legitimate, especially in relation to problems of exchange rate, which has further increased Nigeria’s debt burden, But in terms of looking at other critical variables such as revenue profile and even performance of the economy, he says the debt debate is excessively politicised.
“Based on Nigeria’s debt to GDP figures, arguments of previous PDP administration performing better than the current Buhari administration may appear attractive.”
Mr salihu said part of what is largely responsible for the lower debt to revenue ratio is the reality that under the current administration of President Muhammadu Buhari, Federal Government is making good progress in diversifying revenue sources.
In terms of expenditure assessments, between 1999 and 2015, total expenditure increased from 947.7 billion Naira to 4,988.9 billion Naira. Recurrent expenditure in 1999 was 449.7 billion Naira, which increased to 3,831.9 billion Naira in 2015. And Comparing , between 2015 and 2019, under President Buhari, total expenditure increased to 9,714.6 billion Naira in 2019, from 4,988.9 billion Naira in 2015.
In his opinion, higher budget deficits contribute to pushing governments to borrow,Applying the same logic, expectedly lower debts should encourage governments to have more favourable balanced budgets.
Mr Lukman said considering all the indices of Nigeria’s fiscal management between 1999 and 2020, there is an indicating factor of more prudence under the six years of President Buhari than other administration.