PDP accuses Buhari of planning to borrow N5 billion daily in 2016

Olisa Metuh, Spokesman, PDP

The opposition Peoples Democratic Party, PDP, has accused President Muhammadu Buhari of planning to borrow at least N5 billion per day to finance the N6.08 trillion 2016 budget.

The spokesperson of the party, Olisa Metuh, who spoke with reporters on Tuesday in Abuja, said a breakdown of the N1.84 trillion to be borrowed by Mr. Buhari to fund the budget shows that Nigeria would be borrowing N5 billion a day for the next 365 days, starting from January I, 2016, without corresponding provision for economic production and a clear repayment plan.

“Some people may be wondering why we raised an alarm about the budget. The reason is simple. When we analysed the budget, we discovered it is a misshapen attempt at a Keynesian economics of applying deficit spending to stimulate growth even when studies have proven that GDP growth rates decrease by over 50% when debt goes from low or moderate to high. But then we know the borrowing here is to pay huge campaign debt and fund a political war chest.

“By every standard, this budget is a booby trap against the nation. When you break down the proposed N1.84 trillion borrowing, you discover that it amounts to borrowing N5 billion every day for the 365 days in 2016. The questions are: for what specific projects are they borrowing N5 billion per day and how do they intend to pay back?” Mr. Metuh said.

The PDP spokespersons said Mr. Buhari should explain to Nigerians how his government intends to pay back the loan.

“Is it by continuous borrowing to service the interests, and does he intend to accumulate colossal debt for future generations of Nigerians?

“The truth is that this administration cannot justify this proposal. There is no known economy in the world where you can justify borrowing N1.84 trillion without specific projects and precise repayment outline.

“This is worse still in an oil-driven, mono-economy at a time crude oil is selling at $30 dollars per barrel and is speculated to go down to about $20 dollars or even lower in the next one year. The idea can only come when you diversify the economy and boost production capacity in manufacturing and other critical sectors, a direction, which the budget clearly failed to provide.

“From all indicators, the borrowing will be negative. They are driving us to be like Greece, and to plunge us into unnecessary debt,” he said.

Mr. Metuh also said when the PDP took office in 1999, the party succeeded in the cancellation of inherited debts. He said Mr. Buhari is now seeking to accumulate more debt for the country.

He warned that no country would be ready to cancel Nigeria’s debt again.

“More importantly, we are really worried about negative economic policies of the present administration and the copying of strategies that failed in other economies.

“Recall that we had earlier alerted on the negative consequences of the retrogressive foreign exchange controls wherein this government is making it impossible for honest Nigerians to engage in free trade and regulate their personal activities.

“There seems to be the erroneous belief that the controls will create foreign exchange stability or strengthen the Naira by limiting foreign currency outflows. This policy had badly affected other countries in the recent past; including Argentina, whose new government had to reverse the policy to save their economy. Why then are we copying a policy that failed in other countries?

“In practice, the kind of crude controls the Federal Government is implementing have been proven ineffective in preventing capital flight. By limiting the local availability of foreign exchange, the controls have instead increased the demand for foreign exchange, putting greater pressure on the naira and achieving the exact opposite of what the government in its naivety believed would happen.

“The negative impacts of the ill-conceived controls include the hindering of international trade and discouraging of foreign investment,” Metuh said.

He said current measures are crippling the private sector in Nigeria because businesses are being killed as a result of unavailability of foreign exchange.

Mr. Metuh challenged the Federal Government to a public and open debate on the budget.


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  • ‘elewele

    EDITOR SIR,

    Nigerians are lost. They can’t assess anything by itself. Tell Nigerians
    that their country has been falling off the cliff since Buhari resumed on
    29th May. Nigerians will retort in speculation that it would have been
    worse under Jonathan, but that’s nonsense retort that’s aiding the
    deepening of the Nigerian mess, because it is a license to Buhari
    to continue incompetently to make the Nigerian situation worse,
    after Jonathan was voted out for making Nigeria bad. Secondly,
    there’s no way of knowing what Nigeria would have looked like
    under Goodluck Jonathan today, so no fact can be asserted on
    that point with any truthful confidence except as mere guesswork.
    Jonathan is used as Buhari’s alibi for Nigeria’s current messiness.
    Nigerians who buy into that idle talk have nothing in their heads.

    • Jika

      Strictly your opinion.Simply because people may not agree with your perspective doesn’t make them empty heads.While I concede to you your inalienable right to express your opinion on national issues, i certainly belief that you have over reached your self by denigrating those that chose to hold an opinion which is at variance to yours.

      • D.Dee

        @disqus_StvPga8Tmc:disqus

        NOBODY LOOKING IN AT NIGERIA FROM OUTSIDE SINCE JUNE THIS YEAR
        HAS SAID HE’S SEEN POSITIVE CHANGE IN ANY FACET OF THE COUNTRY.

        • Akin Olagunju

          I’s true O! Let’s ay the truth and shame the devil. Not even IMF or the World Bank or any
          foreign government has ever said Nigeria has taken a turn on a better road under Buhari.
          America has not said so, Britain has not said so, France has not said so, Russia has not.
          Not even China sees progress in Nigeria. So, what are we talking about?

          Instead of real change,
          Nigeria is just falling badly. Look at what JP Morgan did in America in August or so?
          JP Morgan threw out Nigeria’s bonds on its listings and told the whole world that the bank
          can’t vouch for the value of any Nigerian bonds because of Buhari’s ‘opaque management’
          of foreign exchange – which to me, is a long way of saying INCOMPETENT MISMANAGEMENT.
          We must stop looking at the rear mirror and face our current worsening situation in Nigeria.