Rising debt: DMO blames COVID-19, experts say borrowing from CBN dangerous – The introduction of the Monthly Insurance Scheme of Nigeria looks at the financial crisis and the crisis following the coronavirus and economic crisis, the Office of Debt Management said.
Kaosinadi, some of the experts who listened to the accident and continued to borrow money from the Central Bank of Nigeria through excellent advertising.
The DMO members are members of the best-selling group of people who are constantly spreading rumors about us Edo State Governor, Godwin Obaseki said in the city that the N60bn hurricane or storm surge is in addition to the .
In a reply to an enquiry from one of our correspondents, the Director-General of DMO, Patience Oniha, blamed crashed revenue and COVID-19 for increased borrowing.
She said the rate of borrowing had started to come down until COVID-19 forced Nigeria, like many other nations, to increase its borrowing in order to buoy the economy.
Oniha said, “The higher level of borrowing from 2015 due to the revenue crash occasioned by crude oil started trending downwards thereafter.
“Unfortunately, COVID reversed that trend. That became necessary and many countries including the UK and USA also embarked on new borrowing.”
She added, “It is not correct to say that the economic team is not concerned about how the debt will be repaid. You know that a Debt Sustainability Analysis and Medium Term Debt Strategy are done.”
The DMO boss noted that apart from the Federal Government, the states are also borrowing increasingly too.
She added, “I am unable to comment on the ‘top-up’ at Federal Accounts Allocation Committee as the DMO is not involved in the determination of how much is shared at FAAC.
The DMO stated that new borrowing to part finance budget deficits had declined steadily from N2.36tn in 2017 to N2.01tn in 2018, N1.61tn in 2019 and N1.59tn in the first 2020 Appropriation Act.
This trend was reversed in 2020 due to the economic and social impact of the COVID-19 pandemic as new borrowing in the revised 2020 Appropriation Act was N4.2tn.
The DMO stated, “It should be noted though, that apart from the new domestic borrowing of N2.3tn, the other new borrowings were concessional loans from the International Monetary Fund ($3.34bn) and other multilateral and bilateral lenders.
“This incremental borrowing to part-finance the 2020 budget and the additional issuance of promissory notes to settle some arrears of the Federal Government of Nigeria, contributed to the increase in public debt stock.
“New domestic borrowings by state governments also contributed to the growth in the public debt stock.”
The Director-General, Lagos Chamber of Commerce and Industry, Dr. Muda Yusuf, and a former President, Association of National Accountants of Nigeria, Dr Sam Nzekwe, stated that government borrowing from the CBN was not new.
Yusuf said, “The governor of Edo State has not said anything new. The situation is even worse than the picture he painted. The CBN financing of government deficit has reached unprecedented levels in recent years.
“In 2020, it was in excess of N2tn. In monetary parlance, it is referred to as Ways and Means financing by the CBN.”
Yusuf said these were reflections of the weak revenue performance of government in the face of growing expenditure.
“The situation clearly poses serious macroeconomic risks, some of which has started to crystallise,” he stated.
The LCCI boss added, “The biggest of such risks is the inflation risk. It is a contributory factor to the current high inflationary pressure in the economy.
“Inflation was at 17.33 per cent as at February, one of the highest in recent times. Food inflation is even much higher at over 21 per cent.”
Yusuf said there were also implications for the currency, stressing that mounting ways and means financing had increased money supply and invariably weakened the currency.
- EPL: Newcastle boost survival bid as Man United eye Tottenham revenge
- Kidnappers ambush Ogun hunters on rescue mission, burn two vehicles, nine motorcycles
- 11 kidnapped victims regain freedom in Zamfara
- Three dead as youths repel gunmen attack in Katsina
- Why I founded Nina Empire –Nina Ivy
- EPL: Arsenal beat Sheffield 3-0 to end four-game winless run
- Ex minister, Gana, five others rejoin PDP
- Ex minister, Gana, five others rejoin PDP
- 2023: Saraki, Mark, Ayu mobilise PDP chieftains ahead of polls
- What makes me a complete artiste –Jbwai