Former Nigerian President, General Olusegun Obasanjo has described the way President Mohammadu Buhari is borrowing for recurrent expenditure as an act of foolishness, added that ” accumulating debt for the next generation” is a criminal act.
Chief Obasanjo made this known in a video interview posted on Channel’ s Television Facebook page. He stated that borrowing will only make sense if the country is borrowing for development that can pay itself.
He said, ” If you want to build a commercial house and you go and borrow money, and you have 50 percent of your own money and you borrow 50 percent and in five years, you pay the 50 percent that you borrowed. That is a wise thing to do. But if you have to go and borrow money for you to be able to feed yourself and your family, that is a stupid thing to do.
” So, 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? ”
He further explained th $4 billion ($4, 054, 476, 863) and €710 million loan from bilateral and multilateral organisations to fund the deficit in the 2021 budget. at during his time as the President, the Nigerian government was spending $3. 5bn to service debt, added that even with that amount, the quantum of debt was not reducing.
He added, ” When I came into government and as elected President, we were spending $3. 5bn to service debt, and even with that, our quantum of debt was not going down. ”
Recall that President Muhammadu Buhari recently sent a letter to the House of Representatives, seeking the approval of a fresh loan.
It was reported that the President wants to borrow $4 billion ($4, 054, 476, 863) and €710 million loans from different organisations to fund the deficit in the 2021 budget.