Obi Slams Federal Government Over Lavish Borrowing and Spending
Former Anambra State governor and Labour Party presidential candidate in the February 25, 2023 General Elections, Peter Obi, has raised concerns about the Federal Government’s extensive borrowing and extravagant spending on non-essential procurements. Obi warns that this trend poses a serious threat to the economy and may lead to its eventual downfall.
In a statement titled ‘Debt and Waste as Economic Policy,’ Obi criticizes the Federal Government’s securitization of Ways and Means borrowing from the Central Bank of Nigeria (CBN), labeling it as unlawful. He highlights that such actions violate the CBN Act, which specifies that the government’s borrowing from the CBN should not exceed 5% of the previous year’s revenue.Obi emphasizes that the current approach of lavish spending, supported by extensive borrowing, is unsustainable and will have detrimental effects on the economy.
He points out that a significant portion of the so-called ‘capital’ expenditure in the 2024 budget comprises procurement and luxury projects, urging the government to halt this unsustainable pattern.The former governor expresses his concern about the potential consequences, stating, “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.”Obi traces the roots of the problem back to the previous administration, citing the approval of a N22.7 trillion Ways and Means borrowing from the CBN shortly before the end of the Buhari administration’s eight-year tenure.
He criticizes the National Assembly for approving a new securitization request of N7.3 trillion, further burdening the economy.Additionally, Obi questions the lack of transparency in the purpose of recent borrowings, as the president sought and secured approval for an additional $7.8 billion and €100 million without providing specific explanations.
He highlights the need for public accountability, urging the government to disclose the exact purposes of these borrowings and how the funds are utilized.Obi concludes by emphasizing the danger of securitizing illegal borrowings, as it increases the nation’s debt burden without transparent and productive utilization.
He calls for a more accountable and responsible approach to economic management to safeguard the future of the Nigerian economy.Credit Vanguard News