LCCI: The majority of Nigeria’s debt is not tied to specific projects

The Lagos Chamber of Commerce and Industry (LCCI) says the majority of Nigeria’s borrowing is not tied to specific assets and projects.

Speaking to reporters on Wednesday, Toki Mabogunje, chairman of the LCCI, said it was crucial to replace existing debts with asset-linked securities to reduce the amount of money owed by the country and ease the pressure of debt service on the budget.

According to her, the government’s penchant for issuing new debts to buy back those that are due is not an optimal debt management strategy.

“While we recognize the federal government’s desire to drive revenue mobilization through the Strategic Revenue Growth Initiative (SRGI), it is even more important that state governments are very innovative in terms of revenue generation,” Mabogunje said.

“We note that the majority of Nigeria’s debt is not tied to specific assets or projects. As such, it is essential to create a national asset registry and have a coordinated mechanism to assess and manage Nigerian assets. “

At the end of December 2020, Nigeria’s public debt, which includes the outstanding debt of the federal government, state governments and the Federal Capital Territory (FCT), stands at $ 32.91 billion, according to the Debt Management Office (DMO).

Commenting on the recent introduction Nigerian Ports Authority (NPA) electronic call system, the president of the LCCI said that this may not provide a lasting solution as the problem of congestion in ports persists.

“Despite the laudable initiative of the electronic appeal system and the early successes recorded when it was introduced, there seems to be a return to the old method. Many importers and exporters express serious frustrations, ”she said.

“Insurmountable traffic jams and persistent long queues of trucks and tankers in the corridors of Lagos ports remain a major concern for the Lagos Chamber given its negative impact on the country’s economy.

She pleaded for “strong political will” to discipline the entire process of cargo clearance and export evacuation.

To improve currency liquidity, Mabogunje called for the consolidation of multiple exchange rates into one rate reflecting the market.

She lamented that despite the rise in crude oil prices, many investors in the economy are facing difficulties in accessing foreign currency for the import of raw materials, equipment and some essential inputs for production. and transformation.

“This situation has a huge impact on capacity utilization, turnover, sales and profitability. The sustainability of some of these investments is currently threatened with disastrous implications for maintaining jobs, ”she added.