CEM REPORT, GOVERNANCE | President Bola Ahmed Tinubu has called on the private sector to support the initiatives and implementations of his administration to revive the nation’s economy and find lasting solutions to the challenges confronting the country.
He noted that reviving and setting the nation’s economy on the right path for sustainable growth would require hard decisions but noted they would only succeed with the cooperation and collaboration of all, especially the private sector.
The President disclosed this while declaring open the annual Nigeria Bar Association’s (NBA) conference in Abuja themed “Getting it Right: Charting the Course for Nigeria’s Nation-Building”.
He said that his administration would make hard decisions that may not go well with the citizens but assured that the decision was to steer the nation off unstainable paths noting that a new Nigeria was possible with his renewed hope agenda.
“We cannot have the country we desire without the reforms we have initiated. It is painful at the beginning, in the short and medium term, but we must do what we have to do to take this nation to its great destiny.”
“It is not about you, and it is not about me. It is about our generations yet unborn, for whom we must bequeath a great and prosperous country.”
“I am not cynical, I am factual, The critical and bold initiatives embarked upon will yield the desired results only with collaboration and cooperation of the private sector.
“We are so blessed and we are still lacking. A change of mindset is what we need.
“We accused our previous leaders, we complain too much about the past, it is not the solution, we must look forward, God has given us creative minds and will.”
Tinubu further stated that his administration would not continue the practice of servicing the nation’s external debt with 90 per cent of its generated revenue.
He described the practice of servicing debt with more than half of the revenue as a path to destruction which is unstainable.
“Can we continue to service external debts with 90 per cent of our revenue? It is a path to destruction. It is not sustainable. We must make the very difficult changes that are necessary for our country to get up from slumber and be respected among the great nations of the world.”
Additionally, the President said world-class remuneration for legal professionals would also sanitise the judiciary for a prosperous Nigeria.
“I want to learn. Remind me of what I’m doing right, and I will continue, whatever I am doing wrong, tell me, and I will change,’’ the president added.
Recall that the World Bank in its fiscal economic outlook for Nigeria released in April 2023, noted that Nigeria spent around 96 per cent of its revenue on debt servicing in 2022 up from around 80 per cent in 2021. This the bank says is unsustainable.
“The fiscal deficit was estimated at 5.0 per cent of GDP in 2022, breaching the stipulated limit for a federal fiscal deficit of 3 per cent. This has kept the public debt stock at over 38 per cent of GDP and pushed the debt service to revenue ratio from 83.2 per cent in 2021 to 96.3 per cent in 2022.”
Nigeria’s Debt Management Office (DMO) reports that as of 2023, the country’s debt to revenue ratio is 73.5 per cent, which is in excess of the advised level of 50 per cent and, therefore, unsustainable.
The DMO suggested that the FG boost revenue from the budgeted amount of 10 trillion Nigerian Naira in 2023 to 15 trillion Naira.
“Attaining a sustainable FGN debt service-to-revenue ratio would require an increase of FGN revenue from ₦10.49 trillion projected in 2023 budget to about ₦15.5 trillion.”