Dipeolu Defends FG’s Debt Level
The Economic Adviser to the President on Economic Matters, Dr. Yemi Dipeolu, has said that the economy is not doing badly in terms of its Debt to Gross Domestic Product (GDP) ratio.
Dipeolu, disclosed this yesterday in Lagos, at the Chief Financial Officers (CFO) Breakfast Seminar with the theme: “Planning with Purpose: 2019 Economic Outlook,” organised by KPMG Nigeria.
“Debt to GDP ratio refers to the carrying capacity of the economy. It shows what the economy is capable of carrying. In terms of the absolute stock of debt, Nigeria is not doing badly.
“It is understandable the last experience was external indebtedness which caused a lot of apprehension and burden,” he noted.
Dipeolu further noted the country’s debts were reconciled between 2001 and 2002, alleging that what the present government discovered when it took over was that sometimes, they were no projects to show for what the money was taken for, “what they also found out in some cases is that tenure was not balanced out.”
KPMG in its latest CFOs’ Outlook noted that the survey indicated a 10 per cent increase in overall confidence sentiments among finance officers on the prospects for growth in the economy. The report said: “The federal government ambitious expenditure budget of N8.6 trillion as well as state governments’ significant increase in expenditure budget will result in higher overall government spending in 2018.
“However, ability to source funding for the budget, delayed passage of the budget and other implementation challenges may limit its impact in 2018.
“Oil prices are forecasted to hover around $60 per barrel in 2018. The government is also expected to target achievement of 2018 production targets of 2.3 million barrel per day. The key downside risk is election-related disruption of oil production.
“The monetary policy is expected to address the challenge of political pressure to ease the interest rate environment. This is against the background of potential liquidity glut arising from expected fiscal expansion and pre-election activities expected in the run-up to the 2019 elections.”