Nigeria is in huge financial trouble —Obaseki

Governor Godwin Obaseki of Edo State, has raised the alarm on the precarious state of Nigeria’s financial status.

He lamented that the nation has a huge financial burden, with no ideas on how to pay back. “At the end of the month, we just go to Abuja, collect money and we come back to spend. We are in trouble, huge financial trouble,” he explained.

Obaseki spoke on Saturday, during the state transition committee stakeholders’ engagement.
Obaseki, an economist, and former investment banker revealed that the federal government printed N60 billion as part of federal allocation for March.

While also noting that the country’s growing debt is becoming unsustainable.

Below are his exact words:

“At the end of the month we all just go to Abuja, we collect money and we come back and we spend. My brothers and sisters, I am an economist, and I am an investment banker; we are in trouble. Huge financial trouble!

“First, what we used to rely on, crude oil, forget what we are seeing now, $60, $70 per barrel, it is only a mirage; it is only a question of time. Because, the major oil companies- Shell, Chevron- who are the ones producing; they are no longer investing as much in oil.

Read also: Obaseki raises the alarm, says Nigeria’s debt profile to hit N16trn by end of 2021

“Chevron is now one of the world’s largest investors in alternative fuel. Shell is pulling out of Nigeria. So, in another year or so, where would we find this money that we go to Abuja to share every month? Last month, we got FAAC (Federation Account Allocation Committee) for March; the Federal Government printed an additional 50 to 60 billion to top-up for us to share.

“We say remove fuel subsidy, they say no. This April, next week again, we will go to Abuja to share. By the end of this year, our total borrowing is going to be in excess of 15 to 16 trillion. My worry is that we would wake up one day, like Argentina, the naira would be 1000, 2000 to a dollar, and it would keep moving. You can imagine a family, you don’t have money coming in, and you just keep borrowing and borrowing without any means or idea of how to pay back.

“And nobody is looking at that; everybody is looking at 2023. Everybody is blaming Mr President as if he is a magician.

“So, that change in the world economy which is now affecting Nigeria is going to be one of the major factors that will affect our politics going forward; whether we like it or not”.

Obaseki also lamented that Nigeria was the only country in the world where the federal, state and local governments earn salaries at the end of the month.

“Nigeria has changed. The economy of Nigeria is not the same again whether we like it or not. Since the civil war, we have been managing, saying money is not our problem as long as we are pumping crude oil every day.

“So, we have run a very strange economy and strange presidential system where the local, state and federal government, at the end of the month, go and earn salaries. We are the only country in the world that does that.

“Everywhere else, the government relies on the people to produce taxes and that is what they use to run the local government, state and the federation. But with the way we run Nigeria, the country can go to sleep”.

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