Presidential candidate of the Labour Party (LP), Peter Obi has said as part of the country’s fiscal consolidation, it must stop borrowing for consumption.
Obi stated this in a Twitter thread on his handle on Tuesday evening.
Recall that the Nigerian government recently announced plans to borrow N8.80 trillion to finance its budget deficit in 2023.
The move is a breach of the Fiscal Responsibility Act.
President Muhammadu Buhari made this disclosure while presenting the 2023 budget to the national assembly.
The president said the new borrowing will be 4.78% of the estimated Gross Domestic Product (GDP), higher than the 3 percent prescribed by the Fiscal Responsibility Act.
The Act says “aggregate expenditure and the aggregate amount appropriated by the National Assembly for each financial year shall not be more than the estimated aggregate revenue plus a deficit, not exceeding three per cent of the estimated Gross Domestic Product or any sustainable percentage as may be determined by the National Assembly for each financial year.”
According to Obi, he is not against loans per se, adding that all loans must be invested in regenerative projects.
He also said the country ought to operate within available resources and strive for a balanced national budget as cost-saving measures.
Obi said, “I am not against loans per se; but as part of our fiscal consolidation, we must stop borrowing for consumption.
“All loans must be invested in regenerative projects. We must operate within available resources and strive for a balanced national budget as cost-saving measures.”
The former Anambra governor vowed, “We shall pursue a drastic reduction in the cost of governance and corruption by following due process.”
I am not against loans per se; but as part of our fiscal consolidation, we must stop borrowing for consumption. All loans must be invested in regenerative projects. We must operate within available resources and strive for a balanced national budget as cost saving measures.
— Peter Obi (@PeterObi) November 15, 2022
