Stakeholders raise concern over N2.45 trillion budget to service debt

As the Federal Government commits N2.45 trillion of its N10.002 trillion 2020 budget estimates on debt servicing, the stakeholders expressed their worries, with claims that the rise in public debt is harmful to the country's economy.

Reacting to the debt servicing allocation, President, Chartered Institute of Bankers of Nigeria, Dr. Uche Olowu, had said, “That is a warning signal, and I hope those debts have been judiciously used because we are serving debt. If the expected impact outcome is not achieved, then we are back to status quo.”

On his part, a former President of the Association of National Accountants of Nigeria (ANAN), Dr Sam Nzekwe, expressed that the amount for debt servicing is disturbing.

According to Nzekwe, when a country is spending about a quarter of its budget on debt servicing, there is a problem.

He added, "the government must think twice, especially when you are funding the budget through loan. We need to see how to increase investment in capital project.”

As at the first six months of the year (2019, the President Muhammadu Buhari-led administration spent N1.11 trillion to cover debt service obligations. This figure was disclosed in the 2020 budget circular released by the Federal Ministry of Finance, Budget and National Planning.  

The data extracted from the Federal Government circular, has it that the Ministry of Finance, Budget and National Planning released a total sum of N1.11 trillion to service debt as at Sunday, June 30, 2019.