Buhari writes Reps over proposed borrowing to finance 2022 budget

President Muhammadu Buhari has written to the House of Representatives to request an increase in the budget deficit for 2022, which is to be paid through domestic borrowing.

Buhari stated this in a letter presented in plenary on Thursday by Speaker Femi Gbajabiamila.

The President also requested that the 2022 Medium-Term Expenditure Framework (MTEF), on which the budget was based, be reviewed.

“As you are aware Mr Speaker, the new development both in the global economy as well as the domestic economy has necessitated the revision of the 2022 fiscal framework on which the 2022 budget was based.

“The total budget deficit is projected to increase from N965.42 billion to N7.35 trillion representing 3.99 percent of the GDP.

“The increment of the deficit will be financed by new borrowings from the domestic market.

“Given the urgency of the request for revision of the 2022 fiscal framework and 2022 budget amendment, I seek the corporation of the National Assembly for expeditious action on this request,” he said.

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The letter was then referred to the House Committee on Finance for further legislative action by the Speaker.

Despite the huge debt profile being incurred by the country, the Federal Government had always justified the continued borrowing, noting that it was crucial towards financing budget deficits and critical infrastructure.

Patience Oniha, the Director-General of the Debt Management Office (DMO), said that government borrowings were done by all countries across the world, mostly to finance critical infrastructure.

The DMO DG further clarified that advanced countries also resort to borrowing in order to boost their economies.

“The issue of debt has become topical in Nigeria that sometimes it almost looks as if borrowing is an offence or a crime.

“The first thing we must understand is that countries across the world borrow, be it poor countries, advanced countries, developed countries, emerging markets. They all borrow.

“We usually hear complaints that debt levels are rising in Nigeria. Globally, debt levels are rising, not just in Nigeria,” she said in a statement, two weeks ago.

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