Chidi Samuel
In an effort to quickly expand the economy and push back from last year’s crippling recession which saw
gross domestic product fall for four consecutive quarters for the first time in twenty five years,
Alabingo.com exclusively gathered that the federal government of Nigeria has decided to raise a bond of
N2trn to pay off outstanding debts to local contractors. Investigations suggest that the bond issue would
see local contractors getting paid for accumulated outstanding bills that had fallen due for as long as
three to five years.
A source at the federal ministry of finance who pleaded for anonymity because he was not authorised to speak
on the issue, informed this publication that all the paper work had been done and that the Honourable minister of finance will
will present same to the federal executive council for approval in the coming days.
As at August 2016, it was estimated that the combined debts owed by all tiers of governments to local
contractors was N2.4trillion of which the federal government was said to owe N1.97trillion or 82 per
cent. The proposed bond issue by the federal government would go a long way in meetng this obligation
and would result in improved liquidity in the banking system, lower domestic interest rates and higher
levels of consumptioon spending, a combination of which, some economists have argued, would see the
economy pick up from its low growth levels of 2016. GDP grew at -0.36 per cent in the first quarter of
previous year, -2.06 per cent in the second quarter and -2.24 per cent by the third quarter of the year.
