Olalekan Aworinde, senior lecturer in economics at Pan Atlantic University, said the speed with which the legislative body approves loan requests made by the executive arm created the impression that the requests were not properly vetted.
He suggested that the NASS assess the efficacy and sustainability of existing loans before approving new ones.
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“The national assembly must examine existing loans to see how they have been used; have they been used for the purposes they were earmarked for or for the purposes the government claimed they were for?
“What is the status of implementation of the projects for which the government stated that the loans were obtained?” They are supposed to be aware of these before approving another loan.”
Sheriffdeen Tella, an expert and professor of economics at Olabisi Onabanjo University in Ogun State, said the legislature’s actions regarding external loan approval were unworthy.
He stated that the NASS was responsible for not only evaluating the effects of the executive’s loans, but also for paying attention to public opinion.
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According to Dr Muda Yusuf, an economist and private sector advocate, the processes for approving loan requests made by the presidency in the National Assembly are primarily political.
He stated that in order for the National Assembly to ensure due diligence, legislators must engage in a more in-depth and non-partisan discussion about the sustainability of the country’s debt.
“The processes are largely political,” he said, adding that “they should have a deeper and nonpartisan conversation on the issue of the country’s debt sustainability.”
According to Yusuf, “according to reports, this request is new because it was not covered in the original borrowing.” It is an addendum to the previously approved original plan. Borrowing for infrastructure development has merit, but the ability to service the debt sustainably should be a critical consideration.
“At this rate, a portion of the borrowing will inevitably be used to fund recurrent expenditure.” Already, actual revenue is insufficient to cover the operating budget. The risk of becoming trapped in debt is quite high.”
Mr Kalu Aja, an Abuja-based financial expert, told our correspondent that the National Assembly needed to consider how the loans would be repaid and how this would affect the revenue-to-debt ratio.
“They need to confirm how many local jobs this loan will create,” he said.
“Nigeria’s current debt repayment is unsustainable. Borrowing in USD is especially risky because it exposes the sovereign balance sheet to exchange rate risks.”
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If crude oil prices fall, Kalu believes the ability to repay will be jeopardized.
“I am particularly intrigued that foreign lenders continue to make these loans to Nigeria,” he said.
CSOs claim that the National Assembly is working against Nigerians.
Olufemi Lawson, Executive Director of the Centre for Public Accountability, stated that the Federal Government has taken greater pleasure in sourcing loans.
“It is concerning that the Federal Government now takes greater delight in continuously sourcing loans, rather than putting more efforts into the capacity of the country to explore the available productive opportunities, which will not only increase foreign earnings, but also increase local productivity,” he said.
“Unfortunately, the National Assembly, having previously approved the 2021 Appropriation Act, which already included these borrowings, is not doing enough to reduce the extent to which these loans are being taken at such a large scale that they are almost mortgaging the country’s future.
“As Nigerians, we should be very concerned that we will be spending a large portion of our future annual budgets on debt servicing.”
Auwal Musa Rafsanjani, Executive Director of the Civil Society Legislative Advocacy Centre, warned National Assembly members that they would be held accountable for their actions against the government and Nigerians.
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“It is truly sad and unfortunate that the government has run out of economic ideas to manage our economy and has effectively resorted to unjustified borrowing, putting the country in a terrible economic crisis,” he said.
“However, the sad aspect is the National Assembly’s failure to review the President’s request on patriotic and national interests to suggest alternatives to the continuous reckless borrowing approval.
“NASS members should be aware that Nigerians are keeping a close eye on their collusion to keep the country in perpetual debt without considering the negative consequences, which is already jeopardizing our development and capacity to overcome our economic challenges.”
He went on to say that the lawmakers would be held accountable for their actions against the nation and the Nigerian people.
Buhari is putting Nigeria’s future at risk, according to the Peoples Democratic Party.
The Peoples Democratic Party has rejected a new attempt to obtain $4 billion and €710 million in foreign loans.
According to the opposition party, the President’s and his All Progressives Congress-led regime’s move was yet another attempt to further mortgage Nigeria’s and Nigerians’ future with less than two years left in office.
This was contained in a statement signed by its National Publicity Secretary, Kola Ologbondiyan, in Abuja on Tuesday, titled ‘Fresh $4bn, €710m loans: Buhari, APC are selling Nigeria, PDP cries out…urges NASS to probe loan looting.’
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“The PDP vehemently rejects reported moves by the President Muhammadu Buhari-led APC administration to further mortgage our nation with a fresh N2.66tn ($4bn and €710m) external loan,” Ologbondiyan said.
“The party laments that, as a result of President Buhari’s and the APC’s reckless borrowing, Nigerians may eventually lack a nation and a patrimony that they can freely call their own, after the APC, which has less than two years to leave office.”
The proposed borrowing, according to Ologbondiyan, is an act of wickedness on the part of individuals who are fully aware that they will be leaving office in less than two years. It called the Buhari administration “incompetent and corrupt.”
Attempts to obtain a response from the APC proved futile. Calls to the National Secretary’s mobile phone number, Senator John Akpanudoedehe’s, were not returned.