Industry watchers today took a cursory appraisal of the rationale behind Government’s growing of the nation’s foreign reserves by $1.85bn, when it was indeed, actually hunting for another fresh external loan of $247.3m.
The stakeholders who specifically noted that
the $1.85bn would positively surge the nation’s foreign position from
$42.87bn of last month, to $44.728bn as of now, has therefore pleaded with
the Federal Government, against shopping for further loans.
An importer, Samuel Egbewole who lauded the Government for its determination to diversify the economy, specifically cautioned against further borrowing.
“If we agree with the accounts from the DMO which puts Nigeria’s external debt at $24.3bn; and you deduct this from the present $44.728bn; and you further deduct the value of present sum of Servicing the loans, then, you will begin to understand why some of us are apprehensive!”, he stated.
“Government wants to grow the external reserves. It also want to achieve a certain level of development in a monolithic economic terrain. We can understand. The normal philosophy would be to borrow so as to fill up the gap.
“But, that should not imply borrowing with all cautions thrown to the winds”, he said, highlighting that the international community knows that our actual foreign reserves is less than $20bn.
But a Customs Broker and freight forwarder urged Nigerians to stop focussing only on foreign reserves, but to take a harder look at even what he called “other facilities”, stressing that Government having exhausted the “short term facilities”, is now lackadaisical in hunting for 30-year loans via bonds!
“Did you understand the warnings from both the IMF and the World Bank?
“Do we need an outsider to tell us that by the time a family, no matter how ingenious is spending a quarter of the family budget on debt servicing, the family head should know that the wealth and health of the youths and the unborn is already being jeopardise!”, he explained, begging President Buhari to sack, with immediate effect, any Minister or adviser who offers the debt trap, as a credible alternative.
It would be recalled that as a part of growing the country’s foreign reserves, the Government had delisted some 41 items from the nation’s import billings, only to realise that some of the items also served as raw materials to the production of other vital items.
Sadly enough, while Nigeria is striving to wake up and harness the gains of its monolithic, crude oil dependent economy, the discovery of more promising alternatives like shale oil, particularly by the US, exacerbated by the introduction of electric cars and massive forage into Solar as an alternative energy.
It would also be recalled that when in October 2016 the nation’s forex reserves was $23.7bn, the foreign debt was not this stupendous and intimidating.
And now that our reserves had risen to $44.8bn, the country is frighteningly tied to an over $24bn debt noose.