The Central Bank Governor, Mallam Lamido Sanusi recently advised the leadership at state and federal levels on the dangers of accumulating too much foreign loan, saying it would be a burden on future generations and could destabilize the economy.
Quick to counter his position was the Minister of Finance and Coordinating Minister of the Economy, Ngozi Okonjo Iweala. she said there was no cause for alarm, citing the debt-to GDP ratio as being at 17% and still below the 25% to 30% ceiling which policy makers had set.
Speaking at the 13th session of the Honorary International Investments Council (HIIC) meeting in London recently, Sanusi said, “We are borrowing more money today at a higher interest rate while leaving the heavy debt burden for our children and grandchildren. For example, if you receive your salary and everyday the money is not enough, you have two options to adjust yourself. Either check your expenditure or check your wages.”
However the Director General, Debt Management Office (DMO), Dr Abraham Nwankwo, said Nigeria will continue incurring debt.
HE said Nigeria’s current external debt profile was $6.2 billion, whilst domestic debt was N6.3 trillion ($39 billion).
He added, ” For 2012, Nigeria’s external debt is projected at $9,021.53 billion; 2013, $12,165.10 billion; 2014, $14,585 billion and 2015, $16,765 billion, adding that “a breakdown for domestic debt is projected at, for 2012, $6,483.81 billion; 2013, $7,125.93 billion; 2014, $7,792.41 billion and 2015, $8, 4441.86 billion.”