Mkpoikana Udoma
Port Harcourt — Former Vice President Atiku Abubakar has raised alarms over Nigeria’s escalating debt crisis, following a recent World Bank report that ranks the country as the third most indebted to the International Development Association, IDA.
Atiku’s concerns come on the heels of a new proposal by President Tinubu-led government to borrow an additional N1.7 trillion to cover a budget shortfall, through the issuance of Euro bonds.
He criticized the government’s borrowing strategy, noting that the new loan was being benchmarked at an exchange rate of N800 to the US dollar, despite the Central Bank of Nigeria’s current rate exceeding N1,600 to 1 USD.
“What makes this particular loan proposal even more concerning is that it is benchmarked at the exchange rate of $1 to N800, whereas the current exchange rate from the Central Bank of Nigeria stands at over N1,600 to $1,” he said, pointing to the significant discrepancy that could further strain Nigeria’s already fragile economy.
The former vice president also questioned the rationale behind the government’s continued borrowing, given claims of record revenue collections, accusing the administration of failing to manage its finances effectively.
Atiku also expressed his concerns over the potential misuse of borrowed funds, arguing that the government’s appetite for loans is not driven by genuine infrastructure and development needs, but by corruption and mismanagement.
“In July this year, Tinubu boasted that the FIRS and Customs under his watch had collected all-time high revenues to finance the Budget. Why are they still borrowing?” Atiku asked.
“These Tinubu’s loans are bone-crushing to Nigerians and bringing insufferable pressure on the economy, especially when they are not properly negotiated and utilized,” he stated,
A report by budget watchdog Budgit further fueled Atiku’s concerns, with the former vice president citing it as evidence of the misallocation of funds in the 2024 Budget.
“A report by Budgit, a budget watchdog, has disclosed that the 2024 Budget is a mess because of the level of pork associated with it,” he noted, referring to the excessive and often unnecessary expenditures in the proposed budget.
Reflecting on Nigeria’s economic history, Atiku lamented the country’s return to the debt trap after the successful debt relief efforts under the Obasanjo administration.
“I feel a sense of personal agony seeing that just a few years after the administration of President Obasanjo took our country out of foreign indebtedness, we are today back at the top spot in the same conundrum,” he said.
Atiku concluded the statement with a strong call for caution, urging the government to adopt a more measured approach to borrowing.
“It is time to apply more caution and arithmetic to the loan frenzy,” he said, warning that Nigeria’s continued borrowing spree risks deepening the country’s debt burden and placing even greater pressure on its citizens and the economy.
