Peter Obi, the Labour Party’s presidential candidate in the 2023 general elections, strongly criticized Nigeria’s mounting debt burden. He expressed grave concerns over the current debt figure of N97.3 trillion, stating that such a staggering level of debt is not only worrisome but also unsustainable for an economy striving to make significant progress.
In a series of tweets on his verified Twitter account on Tuesday, Obi advised President Bola Tinubu’s administration to halt further borrowing and instead evaluate the outcomes achieved with the previous loans taken by the country.
According to the former Anambra state Governor, an even more disturbing aspect is that a substantial portion of these debts has not been utilized for productive purposes. Obi described the expenditure of nearly N10 trillion to service unproductive debts as a dangerous practice for an economy seeking growth.
He emphasized that the current debt situation needs urgent attention and remedial measures to prevent further economic strain on the nation and impede its progress.
Obi wrote, “I remain concerned about our borrowings, considering their galloping situation over the years, and its concomitant effects on the economy. More worrisome is the fact that there has been no corresponding visible usage or investments as required by the law, to show their impact on the nation.
“At the end of the second quarter, Q2, of 2023, our debt stood at N87.9 trillion, which was very disturbing to us, because we were at a loss on what we did with the huge debt, especially the over N30 trillion ways and means borrowed by the last administration, which for me, would have been the end of borrowing without any visible and corresponding investment that will benefit the nation.
“Even more worrisome is that between the end of the third quarter, Q3, and the end of the fourth quarter, Q4, of 2023, about N10 trillion was added to our debt profile, which has now taken our debts to N97.3 trillion, again, without any corresponding visible and verifiable utilization of such debts, to the and best of my knowledge, is the highest ever borrowed in one quarter.
“Last year, 2023, our total debt servicing for domestic debts stood at N4.4 trillion and that of external debt servicing was $3.5 billion, which is about N4.9 trillion. In effect, approximately N10 trillion is now set aside to service unproductive debts.
“The implication is that what we borrowed in a quarter about N10 trillion and what we spend on debt servicing, which is also about N10 trillion, are each more than the combined budgetary allocation for the four highest priority areas, which are; defence (N3.25trn), Education (N2.18trn), Health (1.33trn), and Infrastructure (N1.32trn).
“My appeal to the government of our nation is to please de-accelerate the borrowing, and let us first re-evaluate to see what has, been achieved with our previous loans so far and be able to make better decisions for the good of the nation.
“In the New Nigeria of our dream, our scarce resources will not only be duly accounted for but will be productively and prudently managed in moving our nation from consumption to production.”