Ahmed defends govt borrowing, says Nigeria will regret if it does not invest in infrastructure

By our reporter/ Nigeria’s finance minister, Zainab Ahmed, on Monday defended government’s borrowing, insisting that the federal government is borrowing “sensibly” to cater to the country’s infrastructure needs.

Ahmed who stated this while addressing a press conference on the recent report by the National Bureau of Statistics (NBS) on the growth of the economy, said if Nigeria does not invest in infrastructure, “we will regret it”.

Nigeria’s total public debt had hit N33.1 trillion in March, leading many to worry about the rate at which the government is borrowing to finance infrastructure projects.

But commenting on such concerns at the briefing, the minister said the investments will be beneficial to the country in the future.

She said, “We are borrowing sensibly and we are investing in rail and other infrastructure.”

“If we do not do these investments, we will regret. [These] investments will return revenue in the future.”

Addressing the NBS report, Ahmed explained that the country’s economy would have grown above 5 percent in the second quarter of 2021 but the agriculture sector recorded slower growth, owing to security challenges.

“The 2021 second quarter growth reflects better economic performance compared to the same quarter last year. The same quarter last year, we had a negative growth of -6.10 percent. It is also better than the first quarter of 2021,” she said.

“The service sector recorded a strong performance, growing by 9.27 percent this reporting quarter, representing the fastest growth in this sector since 2010.

“The second quarter growth of 2021 would have been much stronger than the 5.01 percent but for agriculture that recorded a slightly lower growth.

“A number of bottlenecks within the system including insecurity which has negatively affected the sector negatively. Also, the industrial sector slowed down to -1.3 percent.”

She further stated that the non-oil sector contributed majorly to the growth witnessed in the second quarter.

“The non-oil sector recorded a growth of 7 percent which represents the fastest growth since the third quarter of 2014,” she said.