The warning by the World Bank that Nigeria’s debt service cost to revenue ratio could hit 160 percent in five years, except broad-based reforms are implemented to ‘unfreeze’ the fiscal space is one of the trending stories in local newspapers on Wednesday.
The Guardian reports that the World Bank has warned that Nigeria’s debt service cost to revenue ratio could hit 160 per cent in five years, except broad-based reforms are implemented to ‘unfreeze’ the fiscal space.
In a separate report, the global bank also said poorest countries that are eligible to borrow from the International Development Association (IDA) now spend over a 10th of their export revenues to service their long-term public and publicly guaranteed external debts – the highest proportion since 2000.
The report comes amid battles by the Ghanaian government to wean its economy from the risk of debt default and regain economic stability. A statement issued by Ghana’s Finance Minister, Ken Ofori-Atta, on Sunday, said existing domestic bonds would be exchanged for a set of four new bonds maturing between 2027 and 2037.
The West African country is counting on the support of the International Monetary Fund (IMF) to avoid major distress even as it risks further downgrading in the face of social unrest over an unbearable standard of living crisis.
Ghana is one of several African countries, including Nigeria, fighting to prevent a debt crisis.
The Nigerian government, from January to April, spent 119 per cent of its retained earnings on debt servicing.
This is seen as a sign that the country is approaching a fiscal cliff, as it is the first time the country’s debt-to-revenue ratio would hit or exceed 100 per cent.
In a veiled request months ago, President Muhammadu Buhari sought for debt relief or outright cancellation at a United Nations General Assembly (UNGA) in the United States.
The Minister of Finance, Budget and National Planning, Zainab Ahmed, following up at the recent World Bank/International Monetary Meeting (IMF) meetings, said the country was considering a request for debt restructuring, though this was later retracted.
The Guardian had reported that the Federal Government’s debt obligation stood at N35.7 trillion as of June. The amount does not include the Central Bank’s lingering overdrafts estimated at N20 trillion.
The newspaper says that as Nigeria and other African countries continue to explore alternative sources of revenues to meet developmental challenges, President of the African Development Bank (AfDB) Group, Dr. Akinwumi Adesina says diaspora remittances to the continent should be acknowledged, respected and further explored.
Adesina’s observation is based on the fact that the value of remittances from the African diaspora doubled from $37 billion in 2010 to $87 billion in 2019 reaching $95.6 billion in 2021.
The AfDB President further said, “yet, official development assistance to Africa in 2021 was $35 billion or 36 percent of the remittances from the diaspora.’’
According to him, Egypt and Nigeria are among the top 10 remittance recipients globally with $31.5 billion and $19.2 billion in 2021 respectively.
He stated this at a recent event on ‘’Development Without Borders, leveraging the African Diaspora for Inclusive Growth and Sustainable Development in Africa’’, organised by the bank in collaboration with the African Union Commission, the International Organisation for Migration and the African Continental Free Trade Area Secretariat.
In a statement made available to The Guardian yesterday, in Abuja, Adesina insists that African diaspora has become the largest financier of the continent adding, “and it is not debt, it is 100 per cent gifts or grants, a new form of concessional financing that is the key for livelihood and security of millions of Africans.”
He noted that while remittances have helped to meet financial, food, education and health needs as well as serve as countercyclical sources of finance and social protection; much can be done to better tap into these remittances for Africa’s development.
The Punch reports that President Muhammadu Buhari on Tuesday, said maintaining Nigeria’s critical infrastructure may pose a challenge in the medium and long term except for the deliberate repositioning of the National Agency for Science and Engineering Infrastructure by the current regime.
He also said that NASENI would be a pivotal legacy his government will bequeath to the next administration in 2023.
He said, “After this administration, resourcing and sustainability of these critical infrastructure will present a challenge on the medium to long term basis.
“But with our deliberate repositioning NASENI to be at par with other similar agencies of government across the world and optimal performance, we are convinced that the future maintenance of our key national infrastructure are assured.”
Buhari said during the commissioning of the President Muhammadu Buhari Technology and Innovation Complex at NASENI Headquarters, Idu Industrial Zone, Abuja.
This is according to a statement signed by the President’s Special Adviser (Media and Publicity), Femi Adesina, titled New NASENI, pivotal legacy I’ll bequeath to next government- President Buhari; honors exec vice chairman.
The Nigerian President stated that under his watch, the Agency, is being repositioned to become a Technology and Innovation Hub for national development.
He said “This is one pivotal legacy of this administration. With this complex and the available facility, the future of our national competitiveness among global economies is promising.
“We are sure that these advanced Science and Engineering Core facilities will assist our nation in the attainment of Africa Union’s 2063 Agenda and United Nation’s Sustainable Development Goals, 2030,” he said.
The newspaper says that Nigeria’s crude oil production is recovering, climbing right back to about 1.6 million barrels.
Chief Upstream Investment Officer, NNPC Upstream Investment Management Services, Bala Wunti, said this at the 11th Practical Nigerian Content forum in Uyo, Akwa-Ibom state on Tuesday.
According to him, Nigeria’s oil production as of Tuesday was 1. 6 million barrels per day, from 937, 000 barrels per day reported in September.
Wunti maintained that the output increase was a result of the government’s rectangular approach to the fight against crude oil theft.
“Crude theft affects all architecture that funds the country. When the oil theft reached its peak, everything including gas production was affected,” he said.
He said, “One, we have security agencies in which the Navy, the police, and everyone within that space was involved. The second is the regulators angle. At this stage, all regulators are made to fully be part of the efforts. Third is the operators’ angle. And, of course, all operators were involved. The fourth angle is the community angle in which all impacted communities have to be brought under the umbrella of a structured arrangement in the collective effort against crude oil theft. In all, these efforts were able to do three things; Detect, deter and respond appropriately.
“As at today, oil production is at 1.59 million barrels per day,” he said.
Nigeria has been unable to meet OPEC production quota in the last one year.
At the September Federation Account Allocation Committee, a Nigerian National Petroleum Company Limited presentation said Nigeria lost as much as 8.14 million barrels in August.
The PUNCH had reported how the contribution of the oil sector to the Gross Domestic Product of the country fell to 5.7 per cent in the third quarter of this year, according to data sourced from the National Bureau of Statistics.
GIK/APA