NIGERIA is doing well in the bond market because it does not default in repayment, the Minister of Finance, Budget and National Planning, Zainab Ahmed, has said.
The Minister disclosed this while speaking at the closing ceremony of the just-concluded Nigeria Economic Summit Group (NESG) meeting in Abuja.
The Minister argued that the Federal Government does not borrow recklessly without a well-thought-out plan on the justification for the borrowing.
She said: ‘‘We are indeed concerned about paying back loans. If you look at the records, you will find that Nigeria has been consistent in paying both local and foreign loans and that is why whenever we go to the market, they receive us well because we have been faithful in our repayment.
“We do not just put numbers and borrow, this is a work that was done to determine what is required in terms of expenditure and what we expect to generate in terms of revenue and the gap that is not financed by other financing items is debt.
‘‘And then we have a debt management strategy that guides how we borrow. So, borrowing is carefully calibrated to meet the debt service obligations when they fall due.”
Providing insights into the impacts of the borrowed funds, she said: ‘‘If you see the kind of infrastructure that is being deployed, you will see it physically. When you build a road and the travel time of travelers reduces, that is time saved and money in the pockets of people. It is also evident in the quality of roads where you have fewer accidents and those are lives saved. So, there are so many impacts that you cannot count them in monetary terms but in terms of improving the quality of peoples’ lives and ease of doing business.”
Responding to the insinuations that money spent on social intervention programmes are not getting to the target segment of the population, Ahmed said: ‘‘The President believes that we must be accountable and transparent for our actions and also if you see what is happening, people are being held accountable for actions they took that are not supposed to be taken. Now, people know there are consequences for their actions. However, I also believe there should be a reward system.’’
On why capital expenditures do not rise at the same pace as revenue, the Minister said: ‘‘the nature of capital expenditure is because most of them are multi-year projects, even when you deploy revenues, they do not come in one year. It comes in the business productivity and taxes.’’
Providing an overview of the two-day summit, Permanent Secretary, Ministry of Budget and National Planning, Olusola Idowu, said the summit had five thematic areas with a focus on ‘securing our future with the fierce urgency of now’ as a general theme.
He explained: “Under the sub thematic theme ‘high and sustained growth’, we focused on using data to ascertain growth and progress we are already making, ensuring strong investment in the human demographics and infrastructure areas, taking the advantages and opportunities around trade and investment, investing in micro, small and medium enterprise groups which are very significant to job creation and socio-economic growth not just at the federal level, but local and international levels.
“Also, the summit talked about the need for strong accountability in terms of all seen the impact being made in various investments from the private to public sectors.
‘‘Within the area of quality of life, we talked about the urgency in investing in women and children demographics, in particular looking at the area of education and health across different segments of the country and taking advantages presented by digital to provide opportunities for not just educational development but lives and livelihoods and also the opportunities digital uses to impact other areas of health.”
On national security, Idowu stated that there was a strong emphasis on creating an overall quality of life and how it also impacts economic development as a whole.
The summit also laid a high premium on the need for improving the quality of citizen’s engagement, working along with marginalized groups across the country and investing in knowledge and engagement required to have a long-term view in looking at security issues across the nation.
Regarding the political economy, the summit deliberated on the political-economic structures and impacts it has on the overall national economic growth and the need to invest and encourage young people to venture into politics.
The summit said digital transformation, which cuts across all sectors, is instrumental to ensure the implementation of data-driven accountability across all levels, job creation and scaling of case studies.