FG Opens Debt Renegotiation Talks with Lenders
The federal government has started renegotiating the repayment terms for the countries debts with its lenders.
The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, disclosed this yesterday while speaking on a television programme, monitored in Lagos.
The minister said part of the debt renegotiation discussions with Nigeria’s creditors included seeking a stay on the debt service of some of the debts.
“We are also looking at our debt service obligations and we are talking to our lenders to renegotiate the repayment terms or even seek a stay on the debt service, to preserve some of our revenue, so that we can use it to meet the current national emergency demand.
“We also have been able to access funding that is available from the World Bank that had already been signed and effective, which is about $90 million. We have just made a request for extension of that by another $100 million. We have been trying to raise funding to make sure we quickly respond to the health emergency. But while we are doing that, we are also making an assessment of the impact on the economy,” the minister disclosed.
Despite the threat to the health of the Nigerian economy due to the dire economic conditions, Ahmed reiterated that the economy was not broke, saying, “we have resources to manage, but we have been able to find new sources of funds that we were able to realise very quickly to keep Nigeria stable. What we want to make sure is that our growth doesn’t decline so badly that we would have to struggle after this health crisis.”
She further pointed out that the federal government was also prioritising its spending by making sure that it selects carefully where the limited resources would be deployed, as well as adopting some cost-cutting measures.
“For example, we have stopped all employment so that we don’t grow our wage bill,” she said.
According to Ahmed, the Nigerian economy, just like every other economy in the world, has suffered significantly from the COVID-19 pandemic and the subsequent crash in crude oil price for oil producing countries.