The Federal Government says N3.36tn has been allocated for fuel subsidy in 2023 as Nigeria’s debt profile hits $102bn

The federal government says N3.36 trillion has been allocated for fuel subsidy in the first half of 2023.

Zainab Ahmed, minister of finance, made this known on Wednesday, October 19, in Abuja.

Ahmed said the 2023 budget proposal has a deficit of N10.78 trillion. She said the deficit will be funded through domestic and multilateral borrowings and proceeds from privatisation.

According to her, of Nigeria’s $102bn debt, 35% is foreign and 65% is domestic, adding that the current public debt is at 23% of the country’s gross domestic product.

The minister also said the 2023 budget also factored in 17.16% inflation. According to her, the draft 2023 budget has been prepared on the background of international challenges such as the Russia-Ukraine war and COVID-19 pandemic, adding that revenue generation has been a major challenge to national development in the country.

On allocations for critical sectors, Ahmed said the sum of N2.05 triliion was allocated to education and N1.58 trillion for health. She added that N2.74 trillion was earmarked for defense and security, infrastructure got N998.9 billion, while social development and poverty reduction has N756 billion.

Meanwhile, Ahmed had said the federal government will halt spending on petrol subsidy in June 2023.

Lagos mechanic uses client’s Lexus ES350 as collateral for his N1.5m debt

A Nigerian man, Emmy Walker, has revealed that his mechanic used his vehicle to try and settle his debt.

According to the man, the mechanic used his Lexus ES350 as collateral for a debt he was owing.

He said he had dropped the car for the mech to fic the Air Conditioner only for him to find out that the same car had been used as collateral for debt to the tune of 1.5 million naira.

Taking to Twitter, Emmy wrote;

”Nothing can surprise me anymore in this Lagos anymore!!!

I gave mechanic my car to fix the A/C, nigga went to drop my car as a collateral for his debt. Madness!!!

How do you drop an ES350 for a 1.5m debt?

How?”

See his post:

Nigeria explains reasons for opposing debt relief to World Bank

Days after kicking against it, Nigeria has told the World Bank and the G20 that debt relief will not sustain the financing needs of Nigeria, Angola and South Africa.

Minister of Finance Budget and National Planning Mrs. Zainab Ahmed, made this disclosure while speaking virtually at the International Monetary Fund (IMF)/World Bank meeting,

Speaking on behalf of Angola and South Africa Constituency, Ahmed commended the Bretton Woods Institutions (BWIs) and the G20 Leadership for the Debt Service Suspension Initiative (DSSI) and calls for its extension.

She however lamented “the associated flows from the DSSI may not sustain the massive financing needs of countries”.

She therefore asked the global bodies to pay “more attention to debt management and domestic resource mobilisation”

Ahmed also said Nigeria welcomes the Progress Report on the 2020 IBRD and International Finance Corporation (IFC) shareholding reviews and continue to support the gradual adjustment of membership shareholding in the World Bank Group (WBG) to address the underrepresentation of members.

“However, given the need for encashments of recently approved IBRD and IFC Subscriptions, as well as the constrained fiscal environment, due to the COVID-19 pandemic, adjustment this time is not advised,” she said.

Given the huge financing gap that exists to support the recovery of African economies, “we share concerns on the capital adequacy of the WBG institutions.

“In this regard, we urge all stakeholders to work together and ensure that Development Association (DA) has enough resources to help the poorest and most resource- constrained members of the WBG.”

To mitigate impact of COVID-19 pandemic on jobs, Ahmed appealed for more investments in broadband network and vocational skills from the international community to close the unemployment gap in the country.

She called for global solidarity in upgrading the digital space in Africa so that the continent can benefit from new jobs.

Ahmed said: “Assuming a strong recovery in 2021 full year (FY21), most of the current jobs may not return, while new jobs will be created”.

Fashola: Obasanjo Should’ve Built Rails, Roads, Instead of $12bn Debt Cancellation

Minister of Works and Housing, Mr. Babatunde Fashola, has blamed former President Olusegun Obasanjo, as partly responsible for Nigeria’s weak infrastructural base, saying that instead of paying off Nigeria’s external debts, the ex-Nigerian leader should have invested in capital projects across the country.

According to Fashola, previous governments which he said had access to a lot of money, under-invested in the country’s infrastructure, saying if he had the $12 billion, like the Olusegun Obasanjo government in 2005, he would have built rails and more roads.

The former Lagos State governor, who has been minister under the present administration since its inception in 2015, spoke during an interview on Channels Television.

In 2005/2006, the Paris Club wrote off $18 billion or 60 per cent of the $30 billion Nigeria owed the cartel, after months of negotiations, a development touted as one of the biggest achievements of the Obasanjo administration.

Fashola said that rather than deploy the funds prudently, the Obasanjo government decided to pay the country’s creditors to the detriment of the country, insisting that today, Nigeria has gone back to borrowing because the governments in the past ignored investment in infrastructure.

He said rather, the Obasanjo government decided to pay the country’s creditors to the detriment of the country, insisting that today, Nigeria has gone back to borrowing because the governments in the past ignored investment in infrastructure.

Although he did not mention names, Fashola specifically said that in 2005 (when Obasanjo was president), Nigeria had the opportunity to revamp its roads and rails, but rather was pursuing debt cancellation as state policy.

“At one time in this country, in 2005, we had $12 billion. At that time, these roads were bad. At that time there was no rail. But what did we do as a matter of state policy, it was just to pay creditors to our own detriment.

I can only imagine if I had the opportunity then with $12 billion in my hand, we would have built rails and roads. What this government is dealing with, which I am responsible for the road side, is the infrastructure that will be enduring.

“Without the rails, we will not have roads that last. Trucks and heavy cargo is not meant for our roads. The jurisdictions we want to be like, don’t transport cargo, containers on their roads. That’s why I am so optimistic about tomorrow that if we advance this significantly, there will be a better tomorrow.

We lost the opportunity to invest $12 billion and then we went back to borrow and the problems haven’t gone away and they will have to be dealt with,” he maintained.

While defending the current administration’s tendency for borrowing, Fashola argued that the assertion that Buhari was mortgaging the future of the nation’s children was untenable, saying that the government was only ‘positioning’ for tomorrow’s children.

“Every generation that’s responsible enough like us must position for tomorrow’s children. We should not leave this for them to come and do because it will be more expensive.

That said, I think the way to go is to say that at the appropriate time, a tolling policy will be developed because for you to toll you must ordinarily develop alternatives. Government must also understand that not all of its infrastructure is of a commercial kind,” he stated.

The minister stressed that the Buhari government would continue to do its best to ensure that the country’s infrastructure is developed and brought at par with modern transportation systems like what obtains in other parts of the world.

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