(3 Minutes Read)
The Chief Economist and Vice President for Economic Governance & Knowledge Management at the African Development Bank (AfDB) Prof. Kevin Chika Urama, has reaffirmed Nigeria’s debt was sustainable. However, he emphasised the importance of addressing the debt-to-revenue ratio to ensure fiscal stability and forward momentum.
He also praised the federal government’s efforts in revenue generation while calling for further action. The government of Nigeria is driving and doing quite a lot to improve revenue mobilisation in the country and by increasing the revenue mobilisation then they will be able to rebalance that ratio and be able to move forward.
Furthermore, he noted the need for Nigeria to tap into global green financing opportunities, saying access to green financing in Africa remains relatively low, with only a fraction of available global green bonds being accessed by African countries. Nigeria and other nations with stronger infrastructure and human capacity have a better chance of accessing climate financing instruments.
Debt is not a bad thing, debt for growth is always a means of driving transformative growth in countries. And the issue is not about debt, but about the quality of the debt in terms of what terms you borrow, and how transparent they are, stated Prof. Urama. And then what do you use those borrowings, the resources borrowed to do? If it is invested in growth-enhancing infrastructure and productive infrastructure, you are going to be able to generate revenue to be able to repay the loans but still also grow your economy. And that is how most countries grow.
Read Also:
https://trendsnafrica.com/nigeria-aspires-to-peak-its-per-capita-gdp-to-us33000-by-2050/
https://trendsnafrica.com/tax-gdp-ratio-of-nigeria-is-low-chief-of-citn/
https://trendsnafrica.com/nigerias-gdp-registers-unexpected-growth/
Prof. Urma noted that the upcoming annual meetings of the AfDB would focus on how Nigeria and other African countries could tap into green financing globally. Countries that are at higher growth trajectories are better developed in terms of infrastructure and human capacity and have greater chances of accessing those climate financing instruments than others.
