House Grills Ahmed, Fashola, Others, over $22.718bn External Borrowing

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Zainab-Ahmed
Minister of Finance, Mrs. Zainab Ahmed

Directs NDDC to recover over 1tn debt from IOCs, FG, others

Adedayo Akinwale ín Abuja

The House of Representatives yesterday grilled the Minister of Finance, Budget and Planning, Mrs. Zainab Ahmed; Minister for Works and Housing, Mr. Babatunde Fashola, and the Minister of State for Transport, Senator Gbemisola Saraki, over the proposed $22.718 billion loan request by President Muhammadu Buhari.

The ministers, who appeared before the House Committee on Aids, Loans and Debts Management, chaired by Hon. Safana Dayyabu, assured that the proposed external borrowing as stipulated in the 2016 – 2018 Medium Term Borrowing Plan became necessary in the interest of the country’s economy.

Ahmed said that President Muhammadu Buhari-led administration has achieved decline share of domestic service in the total public debt from over 83 per cent in December 2015 to about 68 per cent in June 2019.

She explained that Nigeria has a ceiling of 25 per cent on the total public debt stock to Gross Domestic Product Ratio (Debt/GDP) which she said the country has operated, while point out that the ratios for December 31, 2018 and June 30, 2019 were 19.09 per cent and 18.99 per cent, respectively.

Ahmed noted that the debt service to revenue ratio (Debt Service/Revenue) has however, been higher than desirable and provides strong justification for the current drive to increase non-oil revenues significantly.

On his part, Fashola said it was right to have the hearing because government cannot ignore the concerns of members of the public on the debt profile of the country.

He said: “As we cannot ignore those concerns about debt; so, we cannot ignore those concerns about the demand for the provision of life sustaining infrastructure. Everybody wants a road; everybody wants a rail project; everybody wants efficient airport; we want to ensure that our ports are efficient, so that businesses can function more effectively so that clearing of goods can happen more quickly and cheaply and we are in the midst of this fiscal challenge that she identified that the revenue are not just the bought to provide all of these needs.”

He noted that in his ministry for example, they have 524 road projects currently being executed, stressing that as at October this year, the ministry was owing 306 billion to contractors for work already done.

“The amount that the ministry of finance has been able to release to us under the 2019 budget was 73 billion,” he said.

Meanwhile, the House has directed the Niger Delta Development Commission (NDDC) to pay off its existing liabilities through the implementation of its 2019 budget.

It also directed the management as a matter of urgency to recover over N1 trillion it was being owed by various entities including the federal government, International Oil companies (IOCs), Banks and others to help it offset the liabilities.

The Chairman, House Committee on NDDC, Hon. Olubunmi Tunji-Ojo, gave the directive when the Interim management of the commission presented the commission’s 2019 budget before the committee