Kemi Adeosun, minister of finance, says it might take five to 30 years to repay the $5.5billion
loan that President Muhammadu Buhari is seeking.
Last week Tuesday, Buhari approached the national assembly to approve the money, explaining
that $3 billion would be used to service domestic debts while $2.5 billion would be for the
funding of the 2017 budget.
Accusing Buhai of mortgaging the future of Nigerians, the Peoples Democratic Party (PDP)
asked the national assembly yo reject the request.
But speaking when she appeared before the senate committee on local and foreign debts,
Adeosun who was represented by Patience Oniha, director-general of the Debt Management
Office (DMO), said long term-loans, such as this one, would be used to finance capital projects
that had long-term benefits.
The minister urged Nigerians to look at the long-term benefits the country stands to gain from
the loan.
“In terms of tenure, from the figures that distinguished senators have reeled out, we have them
in various tenors. What you do is at the time you get to the market and you want to price, you
will be more certain about the price. It could be anywhere from five to 30 years,” Adeosun said.
“On borrowing, when the current generation may not be around at that time (payment
completion), the truth is that if we are borrowing in the long term, we are using it to finance
capital projects, which are also long-term and the benefits of those projects are also long-term.
“I believe that some of the roads and even institutions like some universities that we see today
were built before some of us were born. We should look at it this way; that the benefits are also
long-term.
“The implication of having that large amount in domestic debt is high debt service because the
costs of – meaning interest rates are high.”
TheCable
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