On the remaining N635 billion, which is
to be borrowed from external sources, he said US$1 billion from the
African Development Bank (AfDB), “but AfDB released $600 million”.
The Ministry of Finance, Nwankwo said,
is working to secure the balance but the current economic situation is
making the realisation a Herculean task. However, Nwankwo noted, there
is some good news because the government “can fall back on domestic
borrowing”.
Nwankwo also told the senators that the
“DMO is working to see that the $1 billion Eurobond is mobilised by
second quarter of 2017”.
The DMO boss said the Federal Government
was servicing its debt as at when due. According to him, of the N1.161
trillion to be serviced in 2016, the government had serviced N1.09
trillion.
“Nigeria is in a very strong position to
service its debts because of our debt sustainability analysis, which
ensures that we make sure that we do not go near threshold of borrowing
and to avoid unsustainable debts, so we are operating miles away from
the threshold,” Nwankwo said.
He assured the legislators that “we will build sustainable economy in the next three to five years.”
On the proposed $29.9 billion loan,
Nwankwo told the senators that “the $30 billion loan will be borrowed
over a three-year period, not at once. Drawdown of the loan will be done
based on the progress of the work and it is essentially for
infrastructure because we don’t have revenue at hand to provide
infrastructure.”
These infrastructure he said, “will help
reduce poverty. There must be no leakages, that should be our focus and
there must be accountability. Investment of $30 billion should be in
infrastructure that can repay itself.”
Internally, Nwankwo said the DMO had
only received overhead allocations up to August this year “because of
recession, so we are making sacrifice.” He also said that of the DMO’s
capital expenditure (Capex) for 2016 (N87.3 million), only N33.79
million had been released.
“We are doing what we can with what we
have to support the economy. We have advertised for tender to execute
some capital items, hoping that the balance will be released,” he said.
Senator Shehu Sani, Chairman Senate
Committee on Local and Foreign Debts, urged the DMO to rigorously pursue
robust and effective debt management measures.
The committee, the senator, said “is
suggesting a holistic review of the Debt Management Office Act to
address current challenges of debt management.
“For example, an accounting officer who
borrows money and misapplies such fund should be held accountable. There
should be consequences for such misdemeanors,” Sani said.
On loan terms and conditions, the
committee, he said, “will henceforth pay attention to the agreement on
terms and conditions for loans obtained by government to forestall a
situation where Nigerians are unnecessarily shortchanged”.
Sani said: “A casual observation of
construction sites of projects funded from EXIM Bank of China reveals
that only foreigners are the engineers, architects and other
professionals. Nigerians are only engaged as unskilled workers. This
situation is unacceptable. Such agreement must be in tandem with our
laws and should serve our collective interest ultimately.”
On the timeliness of receiving drawdowns
from loans contracted by governments, Sani was shocked “to discover
that Lagos State is yet to receive drawdown from the DPO lll the
National Assembly approved since December 2015”. “The executive must
streamline the process and eliminate unnecessary bottlenecks,” the
senator said.
The Nation
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