Over 50 civil society Organisations have called on President Bola Ahmed Tinubu to reschedule Nigeria’s debt with China.
In a communiqué signed by Action Aid Nigeria, BudgIT Foundation, Centre for Social Justice (CSJ), Civil Society Legislative Advocacy Centre (CISLAC), Heinrich Boell Stiftung Nigeria, OXFAM Nigeria, Natural Resource Governance Institute (NRGI), and 48 others, the CSOs noted that the present situation where the country was spending 80 per cent of its resources to service debt was unsustainable.
Analysts have said that the country spends over 90 per cent of its revenue on debt servicing.
The federal government has put Nigeria’s debt profile at N77 trillion including the Ways and Means from the Central Bank of Nigeria (CBN).
The group noted that the huge debt burden has put the country in a position where it would be difficult to fulfill its commitments to achieve the Sustainable Development Goals (SDG) and contribute to the attainment of the climate goals of the Paris Agreement.
According to them, instead of making accelerated progress, the country, like many others on the continent, is regressing.
They therefore urged the National Assembly to review the existing debt management strategy with a view to strengthen it.
“Adhering to relevant legal and institutional fiscal frameworks is important in the context of high and rising debt levels. Although the country has a comprehensive legal framework that specifies processes and obligations of government entities to manage debt, these are not always complied with. For example, annual borrowing plans are not made available to the public and borrowing occurs without being attached to any particular projects, contributing to a lack of transparency and accountability.
“National Assembly should review the existing legal and institutional frameworks relevant to debt management with the view of closing existing loopholes and strengthening transparency and enforcement. For example, the Fiscal Responsibility Commission and Debt Management Office should be empowered to sanction breaches of existing laws and regulations.
“Lawmakers should carry out loan approvals with proper scrutiny and approvals be subject to public hearings and input. Public disclosure of, for example, the terms and conditions of loans, and borrowing plans are critical steps to increase transparency and accountability in Nigeria.
“The Nigerian government and its decision-makers should reduce its reliance on borrowings from the international capital market and commercial loans. There is a need to more strictly adhere to the provision of the law on maintaining concessional loans,” the group said.
While noting that Nigeria’s high debt levels is a function of poor revenue mobilisation through taxes and other means, they urged the federal government to introduce measures that would address the country’s revenue challenge.
“An enhanced Debt Sustainability Analysis that integrate climate and other sustainability risks, and climate resilience benefits, as well as estimates of a country’s financing needs for climate change adaptation, mitigation, and achieving the broader goals set out in the 2030 Agenda for the SDGs;
“Access to debt restructuring for all debt-distressed, climate-vulnerable low and middle-income countries, and a speeding up of debt relief talks;
“A debt restructuring framework that incorporates adequate incentives to ensure private creditors participate and bear a fair share of the burden;
“A departure from regressive conditions attached to debt restructuring frameworks (i.e. cutbacks on social spending), giving room to countries to develop their own plans to advance development and climate resilience (guided by SDG commitments and NDCs);
“The inclusion of disaster clauses in lending deals with public and private creditors to allow countries to divert debt payments to disaster relief;
“The possible establishment of a new Global Debt Authority, designed to operate in an inclusive manner, independent of creditors or debtors, and the development of an international legal framework for sovereign insolvency,” the communiqué read.
