Obaseki: Debt Service Poses Major Challenge for Nigeria

Ndubuisi Francis in Abuja

The Edo State Governor, Mr. Godwin Obaseki, has stated that Nigeria has a serious challenge considering its huge debt service obligation.

With as much as N1.84 trillion earmarked in the budget for debt service alone, he said there was no doubt that this was a huge challenge for the country.

Speaking when he paid a courtesy visit on the newly-appointed Director-General, Debt Management Office (DMO), Ms. Patience Oniha, in Abuja yesterday, he said he realised the challenges facing the nation, and was conversant with the federal government’s balance sheet.

According to him, the appointment of Oniha to superintend over the affairs of the DMO at a time like this was one of the best steps taken by the government.

He stated that managing Nigeria’s debt at this critical period required someone who is clear-headed and unquestionably competent like the new DMO chief executive.

Oniha’s appointment, he added, was propelled by two factors, including God’s divine intervention and her competence, stressing that nobody lobbied for her to get the job.
He urged the top management team of the DMO to support Oniha to succeed in her new task for the benefit of the nation.

The governor, who jocularly remarked that his visit was purely on courtesy basis because of her long-standing partnership with Oniha, said he was not there to seek ways of floating new bonds for Edo State.
Although he pointed out that the one the state floated some years back was almost running its full cycle, he pointed out that the temptation to seek fresh bonds was dampened by high interest rate.

According to him, until interest rate comes down, the state will not consider seeking new bonds with a view to financing infrastructure projects but would rely on public-private partnership (PPP) model.
The governor said his administration was desirous of running Edo State well, assuring that it was service anchored on transparency.

Obaseki disclosed that his government would focus on infrastructure in order to create jobs, adding that education, particularly basic and technical would get special attention.
Edo State, he pointed out, is strategically located and as a hub, his government would leverage on the advantage to develop the state.

Earlier, while welcoming Obaseki and his team, said she was gladdened by the visit of her state governor.
She said the state was meeting obligations and fully compliant in filing required debt data promptly.
She said with the drop in statutory revenues, the emphasis should be on internally generated sources.

Oniha also noted that governments at all levels should embrace more strategic ways of public finance management.
The DMO chief also stated that the organisation was partnering with the states and also provides services to them.
The DMO, she said, is responsible for the management of all external as well as domestic debts and other borrowings by the sovereign.
Oniha said the DMO was created in year 2000, and had passed through very huge challenges in the past.