Nigeria
spent $8.0429 billion to service debt in 2006 and $10.1072 billion in
2005 before the debt relief of 2006. Now the country has an external
debt at $6.67 billion, (about N1.035 trillion), Coordinating Minister
for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala,
yesterday, said.
The
Minister however said that the clarification became necessary in view
of the various figures being quoted in the debate over the nation’s
indebtedness.
“As
at now, our external indebtedness is as low as $6.67 billion or about 3
percent of Gross Domestic Product, GDP,” Okonjo-Iweala said.
According
to her, “the external debt is typically owed to foreign creditors such
as multilateral agencies [like the Africa Development Bank, World Bank,
the Islamic Development Bank], as well as other bilateral sources
[including the China Exim Bank, the French Development Bank or the
Japanese Aid Agency], or to private creditors such as investors in our
Eurobonds.”
The Minister said that most external loans were contracted on concessional terms.
“Many
of the multilateral loans are at zero interests, 40 years maturity, and
10 years grace. Others are at less than three percent rate of
interest.”
Okonjo-Iweala assured that the Federal Government would continue to closely monitor the nation’s debt stock to keep it low.
“We
shall never be complacent about our national debt. We need to be
constantly vigilant to limit the amount of debt and create room for the
private sector instead to borrow. As such, we need to stay focused on
three main priorities,” she said.
“We
should continue to monitor our external borrowing and ensure that we do
not slip back to our high indebtedness prior to the debt relief
programme. As I mentioned earlier, the External Borrowing Plan, helps to
address this concern by ensuring that we always have a comprehensive,
transparent view of our foreign borrowing.
“We
should closely continue to monitor and limit our domestic debt, and
ensure that it stays within a prudent and conservative range. We should
pay off debt that is due to the extent of our ability. We should also
continue to closely monitor borrowing by states to ensure that the debt
burdens of our state governments remain within manageable levels and
that borrowings are applied to specific projects that yield results for
citizens of the state.
“In
that regard, we enjoin banks and other lenders to be careful and
prudent when lending to ensure that this is done within the existing
rules, regulations and guidelines.”
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