The Senate has received the committee report on local and Foreign debts.
Presenting the report, the deputy chairman of the committee, Senator Haruna Manu (PDP Taraba central), noted that programme for the refund to Kebbi and Nasarawa state government on the newly constructed airports projects executed on behalf of the Federal government of Nigeria.
Haruna called on his colleagues to support the report and urged Federal government to refund the states.
Details shortly…
The outgoing Governor of Kano State, Dr Abdullahi Ganduje, on Monday handed over the state administration to his successor, Malam Abba Yusuf, including N241 billion debts.
The event took place at the Government House, Kano.
Ganduje was represented at the occasion by the Secretary to the State Government, Alhaji Usman Alhaji, who said his principal left for Abuja to attend the inauguration of President-elect, Sen. Bola Tinubu.
According to Ganduje, his administration collected N1.2 trillion in the last eight years and spent the amount, leaving behind about N241 billion debts.
He explained that the debts comprised of loans, contractual obligations, and other liabilities.
Receiving the handover notes, the governor-elect expressed dismay over the debt profile left for the incoming administration.
“We will carefully study the reports and come out with our position on the debt and other matters.
“I am surprised that the outgoing governor is not around to hand over to me as a democratically elected governor, which has been the tradition.
“However, we will carefully study the reports and come out with our positions,” Yusuf stated.
He called on the people of the state to pray for the success of his administration and to ensure it met the expectation of the governed through good democratic governance.
Present at the event were Sen. Kawu Sumaila; Prof. Hafiz Abubakar, a former deputy governor; the state Head of Service, Alhaji Usman Bala; and state Chairman of NNPP, Alhaji Umar Doguwa, among other dignitaries.
The Debt Management Office, DMO, on Thursday, revealed that Nigeria’s total public debt stock increased to N46.25tn or $103.11bn in the fourth quarter of 2022.
The latest figure has made members of the organised private sector and economists to predict that tougher days are ahead for Nigerians and firms.
The national debt as of September, 2022, was put at N44.06tn.
According to the office, the new figure consists of the domestic and external total debt stocks of the Federal Government and the sub-national governments (36 state governments and the Federal Capital Territory).
The latest figure was disclosed in a statement by the Debt Management Office.
The DMO stated that the comparative figure of public debt as of December 31, 2021, was N39.56tn or $95.77bn.
TheNewsGuru.com (TNG) reports that this means that the country’s debt increased by N6.69trn or $7.34bn within one year.
Stating reasons for the increase, the DMO said new borrowings by the FGN and sub-national governments, primarily to fund budget deficits and execute projects and the issuance of promissory notes to settle some liabilities also contributed to the growth in the debt stock.
The statement read in part, “As of December 31, 2022, the total public debt stock was N46.25tn or $103.11bn. In terms of composition, total domestic debt stock was N27.55tn ($61.42bn) while total external debt stock was N18.70tn ($41.69bn).
“Amongst the reasons for the increase in the total public debt stock were new borrowings by the FGN and sub-national governments, primarily to fund budget deficits and execute projects. The issuance of promissory notes by the FGN to settle some liabilities also contributed to the growth in the debt stock.
“On-going efforts by the Government to increase revenues from oil and non-oil sources through initiatives such as the Finance Acts and the Strategic Revenue Mobilization initiative are expected to support debt sustainability.”
The DMO further explained that the debt figure under review was 23.20 per cent of the Gross Domestic Product, indicating that it was well within the limits set by both the federal government and international organisations.
“The total public debt to gross domestic product (GDP) ratio for December 31, 2022, was 23.20 per cent and indicates a slight increase from the figure for December 31, 2022, at 22.47 per cent.
“The ratio of 23.20 per cent is within the 40 per cent limit self-imposed by Nigeria, the 55 per cent limit recommended by the World Bank/International Monetary Fund, and, the 70 per cent limit recommended by the Economic Community of West African States.”
Reacting, the Director, Center of Promotion for Private Enterprise, Muda Yusuf, expressed concern over the multiplier effect of the latest debt figure, stating that the country would continue to struggle with servicing of debts if drastic steps were not taken.
He said, “What this means is that the country will continue to struggle with servicing of debts. Already, debt service is close to 80 per cent of our revenue and it is likely to increase with the new figure.
“The implication is that we are likely to get ourselves into a vicious cycle of debt, like a debt trap because the higher debt service burden is, when your revenue is low, the more you continue to borrow to be able to sustain the system. Remember that the N23tn from the CBN Ways and Means is not part of this. If we add that, it will make it almost N80tn.
On possible solutions, Yusuf stated that removal of fuel and foreign exchange subsidy would increase the nation’s revenue.
“A possible solution is to increase our revenue through the removal of fuel subsidy and foreign exchange subsidy. This will bring relief of N8trn. We also have to address increasing oil production, curb leakages, cut our spending,” he added.
On his part, a professor of Economics at the University of Uyo, Akpan Ekpo, “Those figures are worrisome because our revenue base is very low. I just hope the borrowing was for infrastructure and the government is transparent on what it was spent on.
“Those debts should not be on recurrent expenditure because that is a waste. Borrowing to fill up the deficit is not good for our economy either. If it was spent on capital projects, can the projects pay the debts back? The debt is for future generations. We need to get information on debt servicing revenue ratio or debt revenue because our revenue base is not healthy at all.”
A professor of Financial Economics at the University of Uyo, Leo Ukpong, posited that the inability of the country to service might lead to an increase in taxes.
He said, “Borrowing tends to have a negative effect on the credibility of the borrower. Clearly, we know that public debt is very high and this increase is not good for the country.
“When debts rise, you run the risk of bankruptcy but since a country can’t be declared bankrupt, it is likely that taxes will be increased which will reduce our purchasing power.”
Members of the organised private have also reacted to the development.
On his part, the Deputy-President of the Lagos Chamber of Commerce and Industry, Gabriel Idahosa described Nigeria’s continued recourse to borrowing as worrisome for the economy.
Idahosa said, “We are looking at external borrowing that is not tied to specific revenue-generating projects, that are not collateralised. For example, if you want to take a loan to build a seaport, to be paid from the operations of the seaport, it can still raise money. But if you want to borrow money and use it for various projects that do not generate income, hoping to pay from the federal budget, then you are not likely to make any progress.”
The Abuja Environmental Protection Board (AEPB) says it may lockdown some government offices, hotels, Plazas and other business premises due to debts owed the board.
The Director of AEPB, Mr Osilama Briamah, made the disclosure in a statement, on Monday in Abuja.
Brianah explained that the measure was coming on the heels of the Task Team set up by the FCTA Permanent Secretary, Mr Olusade Adesola, to recover over N10 billion owed the AEPB by several government agencies, business premises and residential apartments.
” As workers prepare to resume work after the Easter holiday, some government offices, hotels, plazas and other business premises may be under lock and key due to debts owed to the Abuja Environmental Protection Board (AEPB).”
He said that the task team had been mandated to apply all legal means to recover the huge sums of money from the debtors.
The director explained that the debts accrued over time due to the failure of those concerned to pay for services rendered to them by the AEPB.
” All of us desire to live and work in a world-class city compared to other beautiful cities around the world.
” But we can only do that successfully if we behave as responsible citizens and paid our utility bills, especially for solid and liquid waste collection.
“Unfortunately, many agencies, residential apartments, hotels, plazas and so on, are not paying their bills as expected.
” That makes it difficult to raise the money needed to manage a mega-city like Abuja”, he said.
He said beginning from 5:30a.m. on Tuesday April 19, based on a court order already obtained by the AEPB, the task team would embark on mass seal-up of the affected facilities with the aim of recovering the huge money being owed.
He lamented that the AEPB had made moves to provide a soft-landing for the debtors, through negotiated settlement but to no avail.
Briamah added that the only option left was to apply the legal means of enforcing the court order to seal-up the affected premises.
The Director, however, said the affected debtors could avoid the impending embarrassment by ensuring prompt payment of their liabilities.
He explained that the payments could be made conveniently through the Remita Portal.
Newly sworn-in Governor of Anambra State, Prof Charles Soludo has revealed his predecessor, Willie Obiano left N300 million cash and a debt of over N100 billion as of December 2021.
TheNewsGuru.com (TNG) reports Soludo made this revelation on a national television programme on Tuesday.
According to Soludo, other financial details from January to date are still unavailable.
He, however, said he expects those documents to be made available as soon as possible, stressing they are public documents.
“In terms of debt I inherited, it runs into hundreds of billions of Naira. In that of cash, we met about 300 million Naira. In fact, let’s not talk about it. Our treasury is funny.
“But I hope we shall make money henceforth to help us fulfill our promises for infrastructure and development of the state. But in terms of what I met in our coffers, my brother, it’s pathetic. Please let us not go there. God will help us.
“The audited account of Anambra State is open source where anyone can see the assets and liabilities. We are still going to do the reconciliation and we intend to have a very transparent public financial management,” Soludo stated.
Meanwhile, Soludo also praised the former Governor saying, “Willie Obiano is an honourable man and he kept his word. He did his best to his utmost and he laid some good foundations and make amendments and continue the trajectory.”
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President Muhammadu Buhari has called on health workers, including members of the National Association of Resident Doctors (NARD) to return to their duty posts.
He made the call on Friday during a meeting with members of the Nigerian Medical Association (NMA) at the State House in Abuja.
The President urged others contemplating strikes to opt for settlement of issues by negotiation, no matter how long it takes.
“Debts genuinely owed Health workers will be settled,” he was quoted as saying in a statement by his media aide, Garba Shehu. “This administration has a good track record of paying all debts owed to government workers, pensioners, and contractors and we have even revisited debts left by past administrations, once due verification is done.
“I learned that some of the 12 points demand in the ongoing strike were already addressed, although the review of a new hazard allowance has not been fully negotiated because of the sharp and deep division within the ranks of the striking doctors.”
President Buhari gave an assurance that all outstanding benefits owed medical doctors would be cleared, after verifications, insisting that going on strike was not an option to consider.
“The lives of citizens that could be lost or damaged when doctors withdraw services, are precious enough to be worth opting for peaceful resolution of differences.
“Protecting our citizens is not to be left to government alone, but taken as a collective responsibility in which, especially medical professionals play a critical role. Let me speak directly to the striking doctors; embarking on industrial action at this time when Nigerians need you most is not the best action to take, no matter the grievances,” he said.
The President said the outstanding issue of an establishment circular issued by the Head of Service, removing house officers, NYSC doctors from the scheme of service had an addendum circular from the National Salaries and Wages Commission to clarify that they would continue to earn the wages attached to them on their present wage structure.
He requested that the agreement reached in the meetings held on August 20 and 21 and captured in the MOU which he saw be religiously implemented.
To further improve the health sector, President Buhari said budgetary allocations had been increased and a Health Sector Reform Committee led by the Vice President had been commissioned to identify and address weaknesses in the health system and align with global best practices that raise public confidence.
According to him, the government is also supporting initiatives to expand health insurance coverage and bring more resources to health financing.
“We have many more challenges ahead and much more to do, for our large population. In this respect, it is important to remind you that, as senior medical personnel and representatives of one of the most respected professional groups in the world, your responsibility for the health and wellbeing of Nigerians is clear,” the President told the NMA leaders.
“It does not end only with the welfare of your members but continues with a sense of responsibility for the entire country and its socio-political health and national stability. The global economy has been seriously affected by the pandemic, and despite recent pleasing news of more than five per cent economic growth of Nigeria in the last quarter, we are still having fiscal challenges to deal with, like most other countries.
“The source of revenue that Nigeria has depended on for so long experienced global decline, our population is rising fast and the tension arising from both is fuelling agitation among our youth. Organisations like the NMA could play a very useful moderating role in society.”
President Buhari commended the positive role of the NMA as the apex professional medical association in Nigeria, especially with regard to the ongoing industrial action.
In his remarks, NMA President, Professor Innocent Ujah, thanked the President for the appointment of members into strategic positions in government, assent to the Medical Residency Act, and immunisation coverage.
He said the association was concerned with the strike by doctors and had been doing its best to alleviate the suffering of patients across the country while appealing for an urgent resolution.
The Minister of Health, Dr Osagie Ehanire, who was also present at the meeting, said the NMA had been playing a critical role in the development of the health sector, particularly in tackling pandemics, participating in policy formulation, and population health.
The Asset Management Corporation of Nigeria (AMCON) has taken over 12 assets belonging to Chairman of Global Fleet Group, Jimoh Ibrahim, and frozen all his accounts over his N69.4bn.
The seizure of the assets is pursuant to an order by Justice R.M. Aikawa of a Federal High Court, in Lagos.
AMCON on Wednesday took effective possession of all 12 properties through its Debt Recovery Agent – Pinheiro Legal Partners, which include the following: the building of NICON Investment Limited at Plot 242, Muhammadu Buhari Way, Central Business District, Abuja; NICON Hotels Limited building at Plot 557, Port-Harcourt Crescent, off Gimbiya Street, Abuja and the building of NICON Lekki Limited also at No. 5, Customs Street, Lagos.
Other properties include: The building of Abuja International Hotels Limited located at No. 3, Hospital Road, Lagos; another Property at Plot 242, Muhammadu Buhari Way, Abuja; the former Allied Bank Building on Mile 2, Oshodi Express Way, Apapa Road, Lagos; Energy House located on No. 94, Awolowo Road, Ikoyi, Lagos; NICON Building at No. 40, Madeira Street, Maitama, Abuja; a Residential Apartment at Road 2, House A14, Victoria Garden City, Lagos; NICON Hotels Building at Plot 3, Road 3, Victoria Garden City, Lagos as well as the NICON Luxury Hotel’s Building, Garki I, FCT, Abuja.
In addition to the takeover of the listed properties, the court also ordered the freezing of all accounts belonging to Ibrahim and his companies including Global Fleet Oil & Gas Limited and NICON Investment Limited all of who are defendants in the suit No. FHL/L/CL/776/2016 presided over by Justice Aikawa on Wednesday November 4, 2020.
AMCON’s Spokesman, Jude Nwauzor, said all the assets that are listed by the court and scattered around Abuja and Lagos had been successfully taken over by AMCON with the help of court bailiffs and officers and men of the Nigerian police as mandated by the court.
Former President Olusegun Obasanjo has said Nigeria risks impending bankruptcy over the continuous accumulation of debt by the government.
Obasanjo said things might get worse economically as Nigeria, as well as other African countries, kept piling up debts, saying he was worried for the future generations who would have to pay such loans.
The ex-President said this on Friday in Lagos as a keynote speaker at the “Why I am Alive” campaign.
The initiative, tagged ‘The Nigerian Story,’ had the founder of Trinity House, Pastor Ituah Ighodalo, as chairman of the Board of Advisors.
Presenting his speech, titled ‘Nigeria: The challenges of debt and sustenance of democracy,’ a copy of which was made available to our correspondent, Obasanjo said as at 2015, Nigeria’s total external debt was about $10.32bn.
By March 2019, the former President said the country’s external debt had increased to $81.274bn, noting that to service this current level of indebtedness, Nigeria must commit at least 50 per cent of its foreign earnings.
“Such a situation talks about an impending bankruptcy. No entity can survive while devoting 50 per cent of its revenue to debt servicing,” Obasanjo said.
“It has recently been pointed out that in 2018 that total debt servicing took over 60 per cent of government revenue. What’s more, we are not doing enough to address the fundamental, deep-seated and structural challenges that inhibit the expansion of our economy,” the ex-President added.
The Vice-President, Prof. Yemi Osinbajo, has directed that new approaches to be adopted in the recovery of debts owed the Assets Management Corporation of Nigeria (AMCON).
Osinbajo’s spokeman, Mr Laolu Akande, in a statement on Tuesday in Abuja said the directive was part of the Federal Government’s renewed effort to ensure the effective recovery of over five trillion naira being outstanding debts owed AMCON.
Osinbajo on Monday met with board members and management of AMCON and selected heads of government agencies, at the Presidential Villa following which a new committee was set up to carry out the assignment.
The agencies included Economic and Financial Crimes Commission (EFCC), Nigerian Financial Intelligence Unit (NFIU), Independent Corrupt Practices Commission (ICPC) and the permanent secretaries of the Ministries of Justice and Transportation.
Osinbajo said a special task force/committee comprising the Heads of AMCON, EFCC), NFIU, ICPC and the Ministry of Justice, would be working to develop and implement new strategies that would ensure speedy recovery of the debts.
The vice-president said all the relevant agencies had to re-strategise to achieve the desired results.
“The key is collaboration.
“We need a small team comprising these agencies to look at the next steps that we need to take, especially the criminal aspect, forfeiture, and all of that,” he said.
He said that the task force should look at the top 20 AMCON defaulters closely and develop a plan of action that would bring results.
The vice-president in May met with AMCON management to discuss how to resolve the issue.
The AMCON Chairman, Mr Muiz Banire, said that almost 67 per cent of the outstanding debt was owed by 20 individuals/entities.
Banire noted that the agency had been trying its best to recover the debts through the civil judicial process but had encountered several challenges.
Present at the meeting was the Acting Chairman of EFCC, Mr Ibrahim Magu, the Chairman, ICPC, Prof. Bolaji Owasanoye; the Director/Chief Executive Officer of, NFIU, Mr Modibbo Tukur, the Permanent Secretary, Federal Ministry of Transportation, Mr Sabiu Zakari, and other senior government officials.