Ghana, Nigeria in billions of dollars debt

 

 

 

In Ghana the conversation in the Senate and on the media has been direct— Place a moratorium on Government borrowing for one to two years prior to any election. Nigeria is yet to have its conversation despite worse crisis. Nigeria has been borrowing aggressively in recent years. The Jonathan government borrowed 1.1 billion from China in July of 2013 for “Abuja light rail” project and airport repair. This loan was to be repaid in 20 years and came at an interest rate of 2.5%. Rewinding a bit, the Jonathan government launched into action in 2010 with an almost $1 billion  loan, a$915 million concessionary loan from the World Bank to be repaid in 40 years after 7 years loan-draw period. At this time, Nigeria’s external debt stood at $3.98 billion.
The House of Reps approved a borrowing cap of $7.3 billion for 2013-2015; while Nigeria borrowed $4.4 billion from the World bank with $1.8 billion disbursed and the rest attracting service
charges, Business Eye reports. In November this year, Jonathan borrowed another almost $1 Billion from the International Development Association of the World Bank, to “diversify the Nigerian economy.” The $945 million loan repayable in 20 years at an interest rate of 1.5% and service fee of 0.75%. Nigeria has the highest borrow rate in Africa, period. According to Business Eye, Nigeria has become the largest recipient of loans from the International Development Agency (IDA) arm of the World Bank between 2009 and 2012 and currently has the largest outstanding IDA portfolio in Africa, ahead of Kenya and Tanzania.
Additional loans like the $1 Billion to supposedly fight Boko Haram, paint a picture of a nation that lives off of financial indebtedness. We also have dozens of other loans from varying counties, including the $100 million loan from the Indian Import-Export Bank in 2012 for Kaduna, Enugu and Cross River States, which is to be paid back in 10 years at 2% interest rates. He who goes a borrowing goes a sorrowing they say. A unique example out of the African region which defies the need for loan dependent development is that of Kano Governor in North West Nigeria, Rabiu Kwankwaso who steered significant development in his State, one-third the population of Ghana while actually paying off past debts and keeping the State 100% debt free.
Nigeria has become loan dependent under the current administration which cannot account for the nation’s oil revenue and has financed all partial infrastructure developments on crippling loans that promise to send the nation into humiliating suffering and slavery to the colonial and Eastern financial institutions for the next 40 years.