Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by olumide3367(m): 9:02am On May 01, 2020 |
If Nigeria can loss such in a short period of time then they have made more in the past. Where is it? Mainwhile
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Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by Coldie(m): 9:05am On May 01, 2020 |
Africa has become so fvcked up that a lot of black people in America get angry when u refer to them as African American.
Would u blame them, every time u google Africa so so bad news, if its not refugee crisis, its war, or hunger, or poverty or drought or unemployment, or recession. |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by sulaak(m): 9:10am On May 01, 2020 |
Foreign debt and accountability in Nigeria
In July 2018, the BusinessDay editorial board, of which I was part of, warned about an impending debt peonage if the large scale of borrowings, at high interest rates, were not curbed by the government. By the time of writing the editorial, Nigeria’s total debt stood at N22.38 trillion ($73.2 billion) representing 19 per cent of GDP. This comprised external debt of about N6.75 trillion (or $22.08 billion) and domestic debt of about N15.629 (or $51.12 billion). This was almost a doubling of the debt in Naira terms from N12.1 trillion in June 2015 (when Buhari effectively took over). Beyond the debt, what was most worrying to us at the time was the issue of debt servicing. Data from the Office of the Accountant General of the Federation and the Budget Office at the time indicated that debt service to revenue ratio worked out at about 70 percent – a figure quite high and unsustainable by global standards.
But in a poor attempt at defending the borrowings of the government, the Debt Management Office (DMO) wrote a rejoinder to our editorial, denying any debt crises and assuring the reading public that regardless of Nigeria’s high debt to service ratio, Nigeria’s borrowing is sustainable (at 19 percent of GDP) and that the “government has also embarked on several revenue boosting initiatives with a view to increasing the size of the revenue available to finance the budget and reduce the debt service to revenue ratio.” For added measure, when we advised the government to instead seek loans from multilateral agencies with very low interest rates instead of approaching shylock investors and borrowers, the DMO accused us of a poor understanding of the lending policies of multilateral agencies and that Nigeria could not approach these agencies because she has no balance of payment crisis.
Of course, the government kept borrowing and by December 2019, the debt had accumulated to N27.40 trillion with an external debt component of $27.8 billion. A look at the spread of the debt shows that Nigeria does not borrow from global multilateral institutions even though they lend at one percent or less. Rather, we go for commercial loans with interest rates of between 7 to 10 percent and recently from China with equally high interest rates. There are two main reasons for this. First, borrowing from multilateral institutions (IMF and the World Bank) is not a politically popular decision in Nigeria. Nigerians are quite emotive when it comes to IMF loans – especially with the conditionalities that come with them. The debates the Structural Adjustment Programme and IMF proposed loans generated in the 1980s come to mind. Some would argue that the fear of IMF conditionalities have pushed the Nigerian government into the arms of shylock investors who would show no mercy when Nigeria defaults on the loans.
But this argument is neither here nor there. The two main conditionalities for which Nigerians always resent the IMF for were – ending the fuel subsidy and floating the naira. History and our bitter experience have proven the multilateral agency right. Rather than invest in education, health and human development of its citizens, the Nigerian government has found it politically expedient to pour all those monies (scarce forex) into subsidising the consumption of petrol and keeping the value of the naira artificially low to enable elite/middle class consumption. Most Nigerians who were seduced into protesting against their true interest in 2011 have come round to see the foolishness behind the whole fuel subsidy regime that gulps billions of dollars yearly.
The second reason is the question of accountability. If multilateral institutions were to give loans to Nigeria, the government will first have to put together a convincing proposal. More importantly, the institutions will also put in place a strong monitoring process to ensure that funds are used judiciously and for the approved projects. What is more, the release of the funds are likely to be staggered with release of future funds dependent on how earlier ones were spent. But we know that Nigeria does not have a track record of judicious utilisation of budgeted funds not to talk of external loans. The accumulated external loans that Obasanjo and Ngozi-Okonjo Iweala succeeded in getting the Paris club and other investors to write off for Nigeria were never spent for the purposes for which they were obtained. The general consensus was that they were mismanaged or outrightly embezzled.
Sadly, the problem of accountability is still with us. Despite Buhari’s claim to integrity, no one can say exactly what the borrowed funds were spent on in the last five years. There is a high probability some of it were used to just service recurrent expenditure.
Clearly then, IMF-type loans would have been the best choice for Nigeria because the proposals and spending would be closely monitored and supervised to ensure value for money. But the Buhari government and even its predecessors would have none of it. As recent as February this year, the government was planning another round of external borrowing to the tune of $22.7 billion. This was after the previous Senate refused a similar request to borrow $30 billion three years earlier. About $500 million of the loan would have been used to digitalise the Nigerian Television Authority (NTA) – a project many critics have termed ‘useless’.
Well, the petro-dollars that the government has always depended on is no longer forthcoming. The financial situation of the country is now so precarious analysts are predicting that there will not be any significant money to share between the federating units in June because of the combined effects of collapsed oil prices and the lockdown of the country. If by 2018, our revenue to debt service ratio was 70 percent, we can reasonably expect that Nigeria’s current revenue is not sufficient to service its debt and is at the point of default. Of course we know what a default would lead to.
https://businessday.ng/columnist/article/foreign-debt-and-accountability-in-nigeria/
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Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by Coldie(m): 9:10am On May 01, 2020 |
Smbody should book mark this my comment, 2030 is not far. 2030 we no still get light for Nigeria make we bet am |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by hollywater: 9:15am On May 01, 2020 |
Good news |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by ayobaye(m): 9:42am On May 01, 2020 |
The post COVID results will affect the country of it is not nipped at the bud now. This is a herculean task that will be borne by the government and masses generally. Diversification of the economy, technological advancements in agriculture, personally cutting costs by Nigerians as taught by COVID should be strictly followed. Drop extravagant spendings, go for the needful and not necessity. |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by Bahdsypha(m): 9:52am On May 01, 2020 |
Coldie:
Right now even with this bad news some people from smwhere still dae born more children so they can use them to vote in 2023... LoL it's sad.. so sad People that are not sure will even live to see 2023 |
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Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by seanjy4konji: 10:30am On May 01, 2020 |
All the ones we have been saving and buhari looting..how has it affected average Nigerian ![](/faces/huh.png) if dem like lose everything |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by adexpa(m): 10:34am On May 01, 2020 |
optimistD: As if I have been feeling the impact of the ones we have been exporting before now. I provide everything they should provide for me. I pay internal security N8000(my share of 24000/month), N2000 for the external security, 2 generators in case one fails, and still got a bill of N21,000 from PHED this month with a threat to disconnect me, which I'm still contesting, note that I wasn't owing as at last month. I don't want to talk about the high private school fees due to their inability to run government schools. Even with the present condition of things, they don't care or rather do not know what to do than to wait for oil money to be shared and embezzled. You will feel the impact now when the price of everything goes up. All the prices you wrote here will shoot up soon because government will make some tough decisions that will affect all organizations and the reactions from those organizations will fall on everyone(consumers). No one enjoys in a nation where economy is in shamble, we just need a leader that will push diversification agenda than other things, a leader that will make diversification his only thing. Drop in crude oil price is a global problem and no oil producing country can run from the reality including US but other countries can suppress the effect from other source of revenue generation. |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by jaybeez: 10:37am On May 01, 2020 |
How does Dangote make his money back from oil. As he has already spent $18 biliion on his refinery and about $10 billion more to completion. With current oil prices, it's gonna be a long road for him. |
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Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by samictelecoms12(m): 12:49pm On May 01, 2020 |
Chai this is huge oo |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by DexterousOne(m): 2:55pm On May 01, 2020 |
chapwiz: Why is IMF always having negative report about Nigeria? Is Nigeria only oil producing country affected by COVID-19? Evil people It's a negative outlook for Nigeria Best believe that |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by jayaim: 3:58pm On May 01, 2020 |
Thank God my prayers are been answered. Fake government that don't know their left from thier right. Restructure no, diversify no. Make fund available to business no |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by Legendguru: 6:27pm On May 01, 2020 |
Gbese |
Re: IMF: Nigeria To Lose Over $26 Billion From Oil Exports by Hornyhub3D: 6:46am On May 02, 2020 |
Mubbyleey: Country’s economy to contract by about 3.4 percent in 2020 is still not bad compare to other countries... I believe Nigerians can understand why the government cannot afford not to loan "not a loan per sé" this money from IMF, the crash in oil prices is a global thing that affects all oil producing states. USA WTI is feeling the heat too, so i hope the Government can fast track this hornyhub3d diversification of a thing... |