Nigeria won’t have exited recession without borrowing – Finance Minister
It will be recalled that on Thursday, October 7, 2021, President Muhammadu Buhari presented a N16.4 trillion 2022 Budget of Economic Growth and Sustainability to a joint session of the National Assembly.
The move was greeted with controversy across the country. Critics and members of the opposition said accumulating debt for the next generations to come is criminal.
According to Obasanjo, if we are borrowing for recurrent expenditure, it is the height of foolery. If we are borrowing for development that can pay itself, that is understandable; then how long will it pay itself? But we are borrowing and accumulating debt for the next generation and the next generation after them, it is criminal, to put it mildly. What are we borrowing for?
Reacting to this, Minister of Finance, Budget and National Planning, Zainab Ahmed has said that the country wouldn’t have exited recession without borrowing.
Ahmed disclosed this during a Public Presentation and Breakdown of the 2022 Appropriation Bill on Friday October 8.
“Having witnessed two consecutive recessions, we have had to spend our way out of recession which contributed significantly to the growth of our public debts.
“It is unlikely that our recovery from these recessions would have been as fast without the sustained government expenditure funded partly by debt.”
Ahmed also said Nigeria will fund its 2022 budget deficit pegged at N6.258 trillion, through fresh borrowings.
She also said the rising level of insecurity in the country has pushed the federal government into borrowing.
The Minister added;
“To compound matters, the country has technically been at war, with the pervasive security challenges across the nation,” the minister added.
“This has necessitated massive expenditures on security equipment and operations, contributing to the fiscal deficit; Defence and Security sector accounts for 22% of the 2022 budget!” Ahmed also maintained that the “debt level of the Federal Government is still within sustainable limits”.