- Kemi Adeosun, the finance minister, has explained why Nigeria can not fund capital projects in the 2017 budget
- Adeosun declared that the budget has ran into a hitch with paucity of funds to finance it
- She said Nigeria can not afford to borrow from the short term market at 18% interest rate
Kemi Adeosun, the finance minister, said Nigeria’s inability to access foreign loans are major impediments to funding of capital projects in the 2017 budget.
Adeosun said federal government could no longer fund the capital projects provided for in the 2017 national budget owing to the problem.
According to Daily Times, by implication, 60 percent of revenue proposed for funding the 2017 budget will now be rolled over to the next year’s budget.
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She said: ''The cost of domestic borrowing is extremely high and our interest rates are high, this compounds our debt servicing problems. How we plan to resolve this is to borrow more from the international market because we get longer tenures and lower interest rates.
''We successfully completed the Sukuk last week and we were able to raise N100 billion which is to be released this week.
''But repositioning of the economy is going to take some time so we need long and patient borrowing.
''So borrowing from the short term market or the Treasury bill at 18 per cent interest rate will be a disservice to our economy. It will compound the debt servicing''.
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Adeosun, however, sought the support of the lawmakers in accessing foreign loans and in curbing direct submission of budget by heads of commissions and agencies.
According to her, ''We need the support of the Senate to ensure that government agencies do not directly take their budgets to the National Assembly because by doing that, they by-pass the scrutiny of the budget office.
''It is in the budget office that we sit down, look at their budget projections and cut it down but when they come directly, they have bypassed the scrutiny and this allows for over-bloated budget''.
Meanwhile, Legit.ng had reported that the Nigerian Senate invited the minister of budget and national planning, Udoma Udo Udoma and Adeosun over the lack of funding of the 2017 budget.
Signing of 2017 budget in June, same old story? - on Legit.ng TV.