By Ozioruva Aliu
WORRIED by Nigeria’s growing debt profile, policy analysts have urged the government to serve as a guarantor for the private sector to borrow from development partners, to accelerate the nation’s infrastructural development.
For instance, they said in the last 30 years, the government has proven to be inefficient in managing foreign loans but that if government serve as guarantor, the private sector has the capacity to borrow, develop the nation’s infrastructure, make a profit and payback.
The Executive Director, Policy House International, Taiwo Akerele, while speaking at the Nigerian Debt Management Advocacy, organized by the African Network Economic and Environment Justice (ANEEJ), noted that in the last 30 years sub-Saharan African countries have demonstrated a lack of efficiency in managing their rising debt, as such models do not work.
Akerele said: “The Nigerian model of borrowing directly is obsolete, and currently we are seriously in infrastructural deficit. Unfortunately, most of the funds borrowed from the World Bank, and IMF have not been used to address the infrastructural deficit. So what we are saying is for the government to rethink their borrowing framework and promote the private sector.”
He recalled that what the Asian tigers did under similar circumstances was to partner and promote the private sector to borrow, invest in critical infrastructure such as rails, road, renewable energy, technology data management, that will, in turn, serve as catalysts for economic development, saying the government can intervene if the private sector default in servicing the debt.
He urged the government to monitor such loans and initiate a framework in terms of debt management.
The Policy Analyst also said if the government is unable to pay salaries, it should devise strategies to reduce bureaucracy, adding that borrowing should be utilized for ventures that are self-paying such as investment in infrastructure.
The Deputy Director, ANEEJ, Leo Atakpu, expressed worry over Nigeria’s current debt put at $31billion with the local debt even higher, saying the country needs debt relief, and cancelation, adding that there is a need for responsible borrowing and lending from creditors.