By Victor Young
Nigeria Employers’ Consultative Association, NECA, weekend, expressed concerns that the twin evils of rising debt profile and fuel subsidy could lead Nigeria to total collapse.
Consequently, NECA urged the Federal Government to take urgent steps to end the unsustainable subsidy regime and rising debt profile.
Director-General of the agency, Mr. Timothy Olawale, contended that the fuel subsidy regime had proved to be unsustainable and a major leakage in national revenue mobilisation.
He said: “The non-deregulation of the petroleum sector has fuelled the continued dependence on offshore sources for petroleum products supply, perennial shortage of petroleum products and unimaginable corruption in the management of the subsidy dispensation.
“These have remained a major concern for organised businesses. Over the last decade, the country has spent over N9 trillion on fuel subsidy, about N15.5 trillion on capital expenditure, N2.1 trillion on health and about 3.9 trillion on education.
“This is a misplacement of priority and shows that critical developmental items such as education, health and infrastructure have suffered due to the expenditure on fuel subsidy.
“The fuel subsidy regime has succeeded in creating phony and emergency billionaires at the expense of millions of pauperised Nigerians.’’
On the growing debt stock of the nation, Olawale said: “Borrowing could have been permissive, given the state of the economy in 2015 but not to the clearly humongous level it has turned out to be.
“Incurring debt for developmental purposes is not in question, but the over $24.39 trillion debt stocks, taking over 20 per cent of annual national budget to service should be enough source of worry.
“Though the argument of debt to GDP ratio is tenable, the IMF warned that Nigeria’s Debt-to-GDP Ratio, though good, is risky and cannot be guaranteed going forward.