Economy

Minister: Ex-President Obasanjo’s $12 billion cash payment for debt’s wrong move

Speaking at the inauguration of a 969-metre `Rebisi’ dual carriage flyover in Port Harcourt, on Saturday, Minister of Works and Housing, by Mr Babatunde Fashola, who made the pronouncement also said that the Federal Government “is not in competition with any state’’ of the federation over project implementation.

Works and Housing Minister, Mr Babatunde Fashola, Thursday faulted the decision of the Olusegun Obasanjo administration to pay $12 billion in cash to Nigeria’s creditors, out of the $30 billion sovereign debt in 2005, saying it was a decision he would have vehemently opposed if he was a member of the Federal Executive Council then.

He argued that such a huge chunk of cash was better channeled into strategic investment in infrastructure, which would have manured Nigeria’s economy for greater exploits.

Fashola, who spoke at a town hall meeting organised by Business Hallmark themed; “Nigeria’s infrastructure revolution; Road to a New Future”, maintained that tackling infrastructure decay was a higher priority than the repayment of the nation’s debt when the decision was taken.

He further argued that if adequate investments were made in infrastructure, such assets would help repay the loans. He said, “Our government in 2005 as a matter of policy decided to go and pay debt of $12 billion cash but our house was in very dire need. That was a policy choice. I would have opposed that decision if I was in government because we needed to invest urgently at that time.

“If we had invested, the results of those investments would have earned us more revenues, much more income and would put us in a better position to service those debts. Fast forward to 2015, after paying $12 billion, we are now owing $32 billion.

“We look for the resources, invest them in infrastructure and use the returns to pay back this loan.”

The Minister, however, said that the Federal Government under Buhari has taken infrastructure to be a priority to boost the socio-economic fortunes of the country.

In demonstrating this, he said the government was currently implementing 896 road and bridges contracts covering over 13,000km in all the states of the federation.

Earlier in his remarks, the Secretary to the Government of the Federation (SGF), Mr. Boss Mustapha, said when the administration of Buhari took over in May 2015, it was confronted with huge infrastructure challenges.

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