By Babajide Komolafe

LAGOS—The Debt Management Office, DMO, has said it was currently designing for implementation appropriate vehicles for attracting funds from Nigerians in Diaspora with the hope of investing it in critical national development priority projects.

Dr. Abraham Nwankwo, Director-General of the DMO,  disclosed this yesterday  in Lagos,  saying such funds around which an instrument would be created, would be used to fund projects such as housing, power generation and distribution, agriculture, healthcare, education  and specialized training institutions, among others.

Speaking at a breakfast meeting with media executives, Nwankwo said  the move, beyond being a call to patriotism, would also enable Nigerians abroad participate  in the growth and development of the country.

Besides this, he said, the idea would involve investors taking control of the process, free of government’s interference, adding that government  would only provide the necessary environment, including the legal framework, that would guaranty the investment. The government, he assured, was willing to take the  investors as development partners, confident that expertise across the world would  come into play, especially as investors were relieving it of the task of  providing those infrastructure through the capital market.

“It is their own equity contribution, their own investment and fears about the possibility of their fingers being burnt (as it did following the stock market meltdown) does not arise, even while they are still taking some kind of risk in this case. They are not lending to government, but pooling resources together to solve some of the nation’s critical infrastructure deficiencies.

We are encouraging them to use the opportunity to invest for themselves and by themselves. This comes with its own challenges,” he stressed.

Such collaboration, which arose from feedbacks during the two interactive sessions held with Diaspora Nigerians in the past, while promoting greater participation in the domestic bond market, Nwankwo noted, is another to  encourage the private sector to seek development funds. This will also further help to make government’s debt suitable in the medium to long-term.

Speaking on “Past, present and future of Nigeria’s public debt management,” the DMO boss noted that managing debt across the world is a very delicate matter, and a double edged sword because when the bond proceeds is well utilized the people gain, and if otherwise, the people loss and still bear the burden of servicing and repaying the debt.

“Debt is not something that you handle casually, but surviving is about managing risks. Government appreciates that borrowing could be tricky, hence the current efforts to improve debt management skills and knowledge across the various segments of the country,” he explained.

The DMO, he continued, has continued to conduct debt sustainability analysis on a quarterly and yearly basis, as part of efforts to boost confidence and reduce innate fear of borrowing among the various arms of government, their ministries, departments and agencies.

“Governments and corporations borrow because you cannot depend on current revenues, otherwise you could be subjecting yourself to very slow growth, hence the need to borrow, thereby using your income in advance. We (as a nation) need to borrow because of the several years we have lost in the past- you need to fast-track in a bid to catch up. The critical thing is that value must be shown for all the borrowed money,” Nwankwo said.

The current administration, he continued, is aware of the need to ensure that the nation’s debt remains sustainable, as the N4.5 trillion domestic and $4.578 billion external debt translates to a total debt-to-GDP ratio of 17 per cent.