The Civil Society Legislative Advocacy Centre, CISLAC, has tasked the President-elect Bola Tinubu to reduce reliance on borrowings from the international capital market or commercial loans and focus his attention on concessional loans.
The CISLAC executive director, Auwal Rafsanjani, gave the charge on Tuesday during an interactive session at the 2023 Spring Meetings of the World Bank and the International Monetary Fund, IMF, in the United States.
According to him, there is a need to strictly adhere to the provision of the law on maintaining concessional loans as this pose limited debt risk and incorporate a mechanism to work out effective restructuring and negotiate debt relief initiatives which are quite impossible with commercial creditors.
He said: “Private creditors’ loans are expensive for a nation such as Nigeria that struggles with revenue generation and as such this frontier of borrowing should be discouraged.”
Mr Rafsanjani noted that with limited access to further financing on concessional terms, and with a growing presence and influence of private creditors in its debt profile, Nigeria’s national debt is growing and increasingly putting the country in a precarious situation, with significant implications for human rights, including to education and health.
“The country’s total public debt stock as of September 2022 was N44trillion (103 billion dollars) and the incoming administration would inherit a debt burden of N77trillion by June 2023, if the proposed N23.7 trillion CBN loan is securitized.
“This will only worsen with the poor revenue generation and endemic effect of exchange rate volatility.”
