President Muhammadu has defended his need for additional financial borrowings by claiming that the federal government’s debt is manageable.
The borrowings, he continued, are related to certain strategic projects.
The borrowings were justified by Buhari in his 2022 budget presentation speech before a joint session of the National Assembly.
Remember how the federal government was chastised for its choice to increase borrowings?
The President acknowledged the concerns, however, and stated that projects for which financing had been acquired could be publicly verified.
Similarly, the President stated that the N16.39 trillion 2022 budget deficit will be covered by new borrowings.
“We expect to finance the deficit primarily through new borrowings totaling 5.01 trillion Naira, 90.73 billion Naira from Privatization Proceeds, and 1.16 trillion Naira from loans acquired for specific development projects,” he said.
“Some have expressed alarm about our reliance on borrowing to cover our budget deficits.
They have every right to be worried. However, we believe that the federal government’s debt level is still within reasonable bounds. Borrowings are for specified strategic projects and are open to public inspection.
“As you are aware, we have experienced two economic downturns during this Administration.
We had to spend our way out of recession in both situations, which entailed an increase in the national debt. Without the sustained government expenditure funded by debt, our recovery from each of the two recessions would not have progressed as quickly.”