The Centre for Anti-Corruption and Open Leadership (CACOL), has cautioned President Bola Tinubu’s administration over the decision to secure fresh loan of $1.5 billion from the World Bank. CACOL made this known in a statement issued and signed by its Director of Administration and Programmes Tola Oresanwo on Tuesday.
It stated this on behalf of the organisation’s Chairman, Mr. Debo Adeniran, that, “It was reported by some sections of the media recently that the Federal Government was engaging the World Bank on a fresh $1.5bn loan.
“To authenticate the report, the Minister of Finance and coordinating Minister of the Economy, Wale Edun, on Monday after the second Federal Executive Council (FEC) meeting presided over by President Bola Tinubu at the Presidential Villa, Abuja, disclosed to newsmen that the federal government has approved an application for $1.5 billion in financing from the World Bank, even as the government approved another $80million financing from the African Development Bank (AfDB).
“According to the minister, the funding will be provided through the International Development Association, known for its virtually interest-free loans.”
The organisation lambasted FG for engaging in more borrowings when it has refused to cut the cost of governance including the proposed purchase of cars for lawmakers. It said this is coming at the time Nigerians are grappling with hardship resulting from food prices inflation, fuel subsidy removal among others.
CACOL said, “The report further stated that so far, Nigeria had secured a total of $1.95bn in loans from the World Bank in the first four months of President Bola Tinubu’s administration. The first was the $750m approved on June 9, 2023, to boost Nigeria’s power sector.
“The second was $500m to help the country’s drive for women’s empowerment and was approved on June 22, 2023. The third was a $700m loan to enhance adolescent girls’ learning and empowerment, which was approved on September 21, 2023.
The CACOL boss said, “The decision of the federal government to continue borrowing amidst the rising debt burden already imposed on the country by the past administrations and the seemingly unsustainable nature of the loans has made us to break the silence of the day on this serious issue.
“If a country that can afford Sports Utility Vehicles (SUVs), allegedly worth N130 million to its lawmakers but still go cap in hand begging Bretton Woods organisations for funds needed to finance its budget, then something is wrong somewhere. If the government must borrow at all, it should not be for servicing recurrent expenditures, but must be targeted on capital projects that would later generate income or grow our gross domestic product (GDP) sporadically.”
“We hope the President and his advisers know the implications of these incessant borrowings on our economy, the value of the naira, the enormity of the debt service burden, the current size of our debt, and our very limited capacity to service both domestic and external debts. Those given us loans also have their stringent conditions attached to it which must be met by the government and most often, some of these conditions are not made public, hence imposing the burden on even unborn generations.”
He added, “We would like to call on the President and his cabinet members to try as much as possible to cut down on our excessive borrowings as a country, they must also strive to reduce the cost of governance and the amount of forex that we send out to other nations through the imports of petroleum products, brand new cars or SUVs, etc.
“The challenges being faced in the oil and gas sector which had impacted negatively on the country’s earnings should be permanently tackled so that government revenue from that sector can be fully maximized.
“Other sources of revenue should also be explored like the blue economy, bringing more rich people into the tax net, exploration and exportation of more mineral resources which nature has richly blessed us with, empowering more people to practice mechanized farming which has the potential of not only ensuring food security within the country but also earning foreign currencies through exportation, etc.
“The administration should be reminded that relying solely on borrowing to finance our budget especially recurrent expenditures is a recipe for impending disaster. ”
On Tuesday, the Labour Party via a statement by its national chairman, Julius Abure, also condemned the FG on the proposed purchase of new vehicles for lawmakers which is to gulp about N57.6 billion.
Source: Vanguard
