Federal Government has suspended its plan to obtain $22.7 billion external loan due to current realities in the global economic landscape. This was disclosed by the Minister of Finance, Mrs. Zainab Ahmed on Monday.
At the 2020 International Conference on the Nigerian Commodities Market, which was organised by the Securities and Exchange Commission (SEC), the minister explained that the government would not go ahead with the loan, even if the lawmakers in the National Assembly approved it.
Why it matters: The decision of the government was taken as market indices do not support external borrowings at the moment. “The parliament is still doing its work on the borrowing plan. One arm of the parliament has completed theirs and the other arm is still working and it is a process that is controlled by the parliament itself, so we are waiting.
“However, we are not going out immediately because the market indication is not in favour of external borrowing at this time. Even if we get approvals we will defer it and watch the market and go out only when the timing is right,” she said.
Details: Ahmed insisted that the government was not relenting on its plans to diversify the country’s economy, adding that unfolding events of the past few months, the coronavirus pandemic and the oil price war, had further reinforced the resolve to diversify the national economy.
According to her, the current challenges in the global economy had brought to the fore the need for the country to develop a non-oil attitude to everything. She said, “Government planned to prioritize expenditure in favour of major capital expenditures that would have a greater impact, and which would create job and visibility and also enhance the ease of doing business in the country.”