Inefficient capacity of the Federal Government to service debt was one of the major concerns of stakeholders at the ongoing National Tax Summit.
They, however, raised concerns about the geometrical increase in Nigeria’s debt profile as they stated that the nation’s debt in naira terms has increased by 500 per cent and by 150 per cent in dollar terms over the last 10 years spanning 2010-2020.
The stakeholders maintained that while there is a whole argument around debt servicing and sustainability, there are concerns that the country spending 60-90 per cent of its revenue to service debt indicates a continuous cycle of borrowing.
The African Development Bank (AfDB), had last week, expressed displeasure on Nigeria’s borrowings that are already in excess of N35.5 trillion.
The development bank said the debt is rarely the problem in itself, but its high debt-servicing ratio is already stifling domestic investments needed to spur economic growth.
The stakeholders who spoke during the tax summit organised by the Tax Justice and Governance Platform, Nigeria, lamented that despite being a resource rich country with a huge population that can be put into production to mobilise revenue, managers of the economy have resorted to borrowing.