Former Vice President Atiku Abubakar, in a series of tweets and a Facebook post on Friday, July 12, 2019, claimed the National Executive Council (NEC) which he chaired in 2006 paid off Nigeria’s entire debt, but available figures obtained from the Debt Management Office (DMO), Nigeria’s official debt agency, show the nation was still indebted to the tune of N2.2 trillion as of year-end 2006.
Atiku, who was the presidential candidate of the main opposition People’s Democratic Party (PDP) in the February 2019 elections, took to Twitter and Facebook using his verified accounts to express his thoughts on Nigeria’s current debt profile two days after DMO released the nation’s debt figures as at the end of the first quarter of 2019.
BusinessDay had exclusively reported that the continuous borrowings by the Federal Government of Nigeria from domestic sources largely sent Nigeria’s total public debt portfolio to N24.95 trillion in the period, causing an increase of N560 billion in three months as against N24.39 trillion debt stock recorded as at the year-end 2018.
“Nigeria’s debt has more than doubled from N12 trillion in 2015 to N24.9 trillion in 2019, yet we became the world headquarters for extreme poverty,” Atiku’s first post on Twitter in reaction to the debt figures read. “Irresponsible borrowing results in unprecedented sorrowing. We mustn’t saddle future generations with debt instead of prosperity.”
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The former vice president went ahead in another post to claim that the National Economic Council in 2016 paid off the country’s entire debt, a move which ought to set the nation free of all forms of debt.
“As head of the National Economic Council in 2006, under the leadership of ex-President Obasanjo, we paid off Nigeria’s entire debt,” Atiku posted on Facebook at 9:00AM and on Twitter at 9:06AM Nigerian time Friday, July 12, 2019. “It thus breaks my heart to see that after the sacrifice, Nigeria in the last 4 years returned to being a heavily indebted extremely poor nation.”
Atiku was the major contender of the candidate of the ruling All Progressives Congress (APC), Muhammadu Buhari, in the 2019 presidential election. According to Nigeria’s electoral umpire, Independent National Election Commission (INEC), President Buhari polled a total of 15,191,847 votes to defeat his closest rival Atiku who scored 11,262,978 votes. The former vice president is currently challenging Buhari’s victory at the presidential election petitions tribunal sitting in Abuja.
Atiku served as vice president for two straight terms from 1999 to 2007 under former President Olusegun Obasanjo.
Since Atiku posted the claim on Twitter, it has so far been liked by more than 2,000 times, shared over 1,000 times and attracted more than 400 divergent comments on Nigeria’s debt portfolio, while a similar post on Facebook has been liked more than 3,300 times and shared over 900 times with comments in excess of 1,200.
BusinessDay gathered different datasets from the state-owned debt agency on Nigeria’s debt stock from end-December 1985 to the first quarter of 2019 to show the country’s debt trend and provide insights into issues surrounding Atiku’s claim.
According to the historical data compiled by BusinessDay, Nigeria owed a total of N2.2 trillion, comprising N1.75 trillion in domestic debt and $3.54 billion payable to external sources.
When the external debt was converted to the local currency, Naira, using the official exchange rate of N127/USD as of year-end 2006 while taking a cue from DMO’s usual conversion methodology, it was observed Nigeria’s external debt obligation was N450 billion. The exchange rate figures were obtained from the Central Bank of Nigeria (CBN).
Although when compared with 2005 when Nigeria’s total debt stock stood at N4.17 trillion, the 2006 figures indicate a significant reduction of 47 percent, particularly the country’s external debt which fell by 82.7 percent from $20.47 billion (equivalent to N2.64 trillion) recorded in 2005.
A breakdown of 2005 debt figures shows a total sum of $15.41 billion and $1.44 billion owed to Paris Club and London Club of Creditors as at the end of the year, respectively, were paid off in 2006, relieving the nation of the debts incurred to member countries of the two clubs.
Nigeria paid a final instalment of $4.5 billion out of a $12 billion reduced debt including arrears owed to the Paris Club of creditor nations on Friday, April 21, 2006, according to a statement by the then President Obasanjo. This came after an agreement Nigeria entered with the Paris Club which discounted about 60 percent ($18 billion) off $30 billion in accumulated debt payable to creditors of Paris Club as debt relief.
Further checks by BusinessDay reveal that the amount owed to the Paris Club of Creditors rose steadily from $7.83 billion in 1985 out of a total foreign debt of $18.9 billion recorded in the year to $30.85 billion as at year-end 2004 out of $35.94 billion external debt, according to data obtained from DMO.
CONCLUSION
Since the former vice president only said NEC “paid off Nigeria’s entire debt” in 2006, and a total of N2.2 trillion was recorded by Nigeria’s DMO as the country’s total debt for the year, the claim by Atiku Abubakar is FALSE.
OLUWASEGUN OLAKOYENIKAN
