Presidency Justifies Taking More Loans Despite Increasing Debt Profile

The presidency on Sunday enjoined those castigating the federal government for taking more loans to refrain from doing so.

It asserted that there was nothing wrong in taking loans as the borrowings were aimed at financing specific project and critical aspects of the economy.

Presidential spokesman Femi Adesina made the assertion when he featured on Southwest Political Circuit, a popular political interview programme on Ibadan-based radio station, Fresh F.M.

Adesina, who called from his Aso Rock office to take questions on aspects of COVID-19 management and economic issues, said Nigeria had what it takes to incur more debts.

He said that there was no need for Nigerians to raise concern about the country’s rising debt profile because the President Muhammadu Buhari administration is applying loans to the specific projects they are meant for.

Although explained that the huge debt, which the country is owing, was incurred by previous administrations, adding that current figures were within the capacity of the country’s Gross Domestic Products (GDP) to service and repay.

Adesina said: “Don’t forget that the International Monetary Fund (IMF) came out to say that Nigeria’s economy has the capacity to absorb more loans and that Nigeria is taking below what its GDP can afford. IMF said it and it is on record. Nigeria’s GDP can service more loans than it is taking. That is a vote of confidence in Nigeria’s ability to repay the loans it is taking.

“Taking loans to use for development is not a crime. But taking loans to steal and pocket as we used to have it in this count; ry is what is criminal. You will find out that even the profile of the loans, Nigerians don’t know it.

“Even former president Olusegun Obasanjo gave a lecture where he quoted a figure about what Nigeria owes. The Debt Management Office (DMO) had to come out to correct him. I think he quoted something in the region of $90b or $100b debt.

“The DMO office came to say all that this administration has taken is a little over $20b. The DMO also told us what the Peoples Democratic Party (PDP) government left as loans and debt. So, a lot of commentators don’t know the correct profile.

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“The loans will be used for development, for provision of infrastructure, open up and stimulate the economy. These loans are good because they are used for development and that is what this administration is doing. The loans are within tolerable limit.

“So, those who are making noise about loans, particularly the outgone government, are only shedding crocodile’s tears because under them, they took loans and pocketed the money and we didn’t see what they did with the loans. But Nigeria is now taking loans and Nigerians can see what the government is doing with the loans.”

He said the government could borrow more money to resuscitate the economy from the consequences of COVID-19 if it deemed it appropriate.

He assured that the Buhari administration was already mulling the possibilities in its efforts to cushion the effects of the pandemic.

With strong economies reeling from the effects of COVID-19, Buhari’s media adviser explained that the Federal Government would carefully apply strategies that would effectively restore the fortunes of the country post-COVID-19.

While responding to the allegation that the Federal Government was supporting farmers in the North to the detriment of their southern counterparts, he said such allegation was coming “from a mindset that is one of the banes of Nigeria.”

He said: “There is what is called LAKE rice, which is a collaboration between Lagos and Kebbi states. Is Lagos in the North? No. Rice is grown massively in Ogun State and is Ogun State in the North? No.

“Every state has the right to access the Anchor Borrowers programme of the Central Bank of Nigeria (CBN). But the CBN has standards and principles and guidelines. Any state that meets the guideline can get the money”