•Says debt burden’ll soon wreck economy
HENRY OJELU FROM VANGAURD
LABOUR Party, LP, presidential candidate during the February 25, 2023 General Elections, Peter Obi, has kicked against what he described as Federal Government’s disturbing pattern of huge borrowing and profligate spending on non-essential procurements, warning that such pattern would soon wreck the economy.
The former Anambra State governor also condemned Federal Government’s securitization of Ways and Means borrowing from the CBN which he said is against the law and the Central Bank of Nigeria, CBN, act which stipulates the limit of FG’s borrowing from the CBN not to exceed 5 per cent of the previous year’s revenue.
In a statement yesterday, titled ‘Debt and Waste as Economic Policy’ Obi said that the current trend of FG’s lavish spending backed only by equally lavish borrowing is unsustainable and would wreck the economy in due course.
He said: “What is emerging is a disturbing pattern of huge borrowing and profligate spending on nonessential procurements which are being termed ‘capital’ expenditure and are being funded with an accumulation of debts. For instance, a good number of these so-called ‘capital’ expenditure items as contained in the 2024 budget are more procurement and luxury projects.
“This trend of lavish spending backed only by equally lavish borrowing is unsustainable and would wreck the economy in due course. It needs to be halted.
“Unless this trend is halted, the nation runs the greater risk of running into more turbulent economic waters in the near future. This is to add my concerned voice to those of many other troubled Nigerians.
“This is the time when we need to go beyond politics and partisan grandstanding to address the fundamental issues of rational economic management. I am afraid that the current administration is not paying sufficient attention to issues of rational economic management. Instead, an unsustainable level of debt is being piled upon the economy thereby further burdening our already distressed populace who are bearing the burden of harsh economic policies not backed by compassionate cushioning policies.”
Tracing the problem from the previous administration, Obi said: “Barely 26 days to the end of its eight-year tenure, the Buhari administration got the Senate to approve a N22.7 trillion Ways and Means borrowing from the CBN. In seven years, CBN lending to the Buhari government had climbed 2700 per cent in flagrant violation of the CBN Act.
“Indifferent to the illegality of the excessive ways and means borrowing, the National Assembly still approved the new Tinubu administration’s request for an N7.3 trn securitization of the existing ways and means facility just before considering the 2024 budget proposals. On December 30, 2023, the last working day of the year 2023, shockingly the President requested the National Assembly…
