• Friday, September 29, 2023
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Experts urge FG to check rising debt, suggest PPP option

Workers complain as state’s debts hit N2.2 trn

Some financial experts have urged the Federal Government to adopt Public-Private Partnership (PPP) as an investment option to fix infrastructure challenges and reduce the nation’s debt profile.

They said in separate interviews with the News Agency of Nigeria (NAN) on Sunday in Lagos that the Federal Government also needed to invest in the mining sector to stop incurring more debts.

Sherifdean Tella, Head of Department of Economics, Olabisi Onabanjo University, said the country would have to ensure more private sector investment to reduce the need for more debts.

“The federal government should be more innovative and adopt more public-private partnership to fix key infrastructure challenges in the country. This will relieve the government of some challenges and ensure it focuses on other developmental issues that will spur growth,” Tella said.

He noted that the federal government could focus more on stopping leakages in all its various establishments.

“All revenue generating ministries department and agencies of the federal government must automate their operations. This will enable them to be more efficient and boost their fiscal revenues as well as facilitating its debt repayment,” he said.

Godwin Anono, President, Standard Shareholders Association of Nigeria (SSAN), said the federal government should invest in the mining sector to enhance its revenues.

“More investment in improving the business environment is imperative to attract more private capital into the sectors. Most states have natural resources that are yet to be harnessed. These can boost our fiscal revenues and reduce the need for borrowing,” Anono said.

Read also: Nigeria’s debt pile takes toll on fragile earnings

He noted that the federal government should support the mining sector, to ensure it records above the six per cent which its currently contributes to the country’s Gross Domestic Products (GDP).

Also, Muda Yusuf, Chief Executive Officer, Center for the Promotion of Private Enterprise (CPPE), said the government could also reduce its expenditure so as not to incur more debts.

“Particularly, the recurrent expenditures which include overhead must be reviewed downward to check the need to further borrow. Too many items that are often budgeted are unnecessary and they are responsible for the deficit been experienced,” Tella said.

According to him, it is worrying that the debt and other developmental issues may be major challenges for the successive government.

“I’m really empathising for the incoming administration because the huge debt stock is a burden to the economy. This, they have to contend with, especially at the expense of the nation’s declining governmental revenues and a tough economic climate in recent times,” he said.

NAN reports that the Nigeria’s Debt Management Office (DMO) said that the next administration would inherit a public debt of N77 trillion if the N23 trillion loans from the Central Bank of Nigeria (CBN) were securitised.

Its Director-General, Patience Oniha, noted that Nigeria’s total debt stock rose to N44.06 trillion as at September 2022.