CBN defends Nigeria’s continuous borrowing

10 Apr CBN defends Nigeria’s continuous borrowing

The Central Bank of Nigeria (CBN) has explained that there is no crime in borrowing for development.

The CBN Governor Godwin Emefiele, said this on Friday in Abuja at the National Dialogue on the Nigeria’s rising debt profile, titled: “The Rising Public Debt in Nigeria and the Challenges of National Development” organised by the ActionAid Nigeria (AAN).

According to Emefiele, represented by the Assistant Director, Monetary Policy Department, CBN, Dr. Tawose Joseph, there is no crime in borrowing, but that there should be monitoring and evaluation of the money borrowed and the purpose meant for.

“Debt is part of fiscal responsibility. Debt is never a crime or a sin. Private entities also borrow to survive. But what matter most is the quantum of the debt and the usage of the debt as well.

“When you compare the income and expenditure and is efficiently used is part of government responsibility. But where the fear is when it is above the threshold.

In her keynote, the Minister of Finance, Budget and Planning, Zainab Ahmed, represented by the Head, Marketing Development Department (MDD), Debt Management Office (DMO), Monday Usiade, said the borrowings by the Federal Government followed due process as the National Assembly approved and passed budgets including monies to be borrowed.

She also commended AAN for conveying the dialogue as it will provide an avenue to broaden the discourse about public debts in Nigeria.

She, however, acknowledged that debt profile is really increasing, saying, “The government acknowledges that the nation’s public debt is growing, and it is also important to add that all borrowings both domestic and external are approved by the National Assembly before they are incurred, that is the representatives of the people.

“The borrowings are approved in the budget that is used to finance the budget offices and other projects presented by the various ministries, departments and agencies of the government. As you may be aware the federal government conducts and publishes debt sustainability analysis on the public debt portfolio on annually basis.