Read on Twitter
I know we are all concentrating on the #EndSARS 
campaign, but here is a thread on some financial information regarding the state of the country's debt that we should all analyse and research!!
We are not all finance people, so it'd be short and as direct as possible
THREAD
campaign, but here is a thread on some financial information regarding the state of the country's debt that we should all analyse and research!!We are not all finance people, so it'd be short and as direct as possible
THREAD
While working in a bank, HR didn't allow staff loans if the repayment was more than 30% of your take home!
This is a key reason why I don't agree with those who quote DEBT:GDP ratio because GDP DOES NOT pay debt.
Pay more attention to the debt service/revenue ratio.
This is a key reason why I don't agree with those who quote DEBT:GDP ratio because GDP DOES NOT pay debt.
Pay more attention to the debt service/revenue ratio.
In June 2015,
- Nigeria's Foreign debt was $10billion
- Nigeria's local currency debt was N10.1trillion
- Nigeria's budget expenditure was N4.3trillion
Fast forward to June 2020,
- Nigeria's Foreign debt is $31.5billion
- Nigeria's local currency debt is N19.5trillion
- Nigeria's Foreign debt was $10billion
- Nigeria's local currency debt was N10.1trillion
- Nigeria's budget expenditure was N4.3trillion
Fast forward to June 2020,
- Nigeria's Foreign debt is $31.5billion
- Nigeria's local currency debt is N19.5trillion
In the 2015 budget of N4.3trillion, about N950billion or 22% was set aside for debt servicing but in the 2021 budget proposal, N3.5trillion is set aside for debt servicing.
Look at it this way:
In just 5 years our debt burden has grown to 80% of what our 2015 budget was!
Look at it this way:
In just 5 years our debt burden has grown to 80% of what our 2015 budget was!
In 2021 budget proposal, our revenue projection is N7.9trillion, so this means we will spend almost half of all our revenues servicing debt of which over 60% was accumulated in just the last 5 years.
Of course, there's nothing wrong with debt unless you have no capacity to repay
Of course, there's nothing wrong with debt unless you have no capacity to repay
By the way, the 2021 budget deficit (the amount we need to still borrow for it to "balance") is more than the entire 2015 budget!!!
But wait, the government claimed it was broke and then went on a borrowing spree but with all this borrowing in the last 5 years, where exactly has the money gone?
Please note I have not added the FGs funding from the @cenbank nor the contractor debts
Please note I have not added the FGs funding from the @cenbank nor the contractor debts
Also, for more perspective, here's my thread from last year on how the @cenbank spent, from my modest assumptions, N6trillion defending the currency https://twitter.com/zeal_a/status/1172525547894771714?s=20
It won't be just discussing the FG without bringing the States (don't worry, it's brief)
According to @nigerianstat, In H1 2020, ALL the states in Nigeria generated N600billion (Lagos alone was N200bn and Rivers N65billion)
So all the other 34 States and FCT generated N335bn
According to @nigerianstat, In H1 2020, ALL the states in Nigeria generated N600billion (Lagos alone was N200bn and Rivers N65billion)
So all the other 34 States and FCT generated N335bn
States are generating an average of N100billion a month but total debt of all the states in USD & NGN is N5.6trillion
Seems we will all owe till we die!! and still leave our kids with debt
Of course, some states are more solvent...maybe 4 or 5 but for all the others, go figure!
Seems we will all owe till we die!! and still leave our kids with debt
Of course, some states are more solvent...maybe 4 or 5 but for all the others, go figure!
Back to FG:
In Q1 this year, that's between Jan - March 2020, the minister of finance stated that our Debt service to revenue ratio was 99%
That is: For every N100 the FG retained, N99 was used to service debt.
If this were a company,... https://nairametrics.com/2020/06/13/nigeria-records-debt-service-to-revenue-ratio-of-99-in-first-quarter-of-2020/
In Q1 this year, that's between Jan - March 2020, the minister of finance stated that our Debt service to revenue ratio was 99%
That is: For every N100 the FG retained, N99 was used to service debt.
If this were a company,... https://nairametrics.com/2020/06/13/nigeria-records-debt-service-to-revenue-ratio-of-99-in-first-quarter-of-2020/
Does the country need more money? ABSOLUTELY!
But how do we get more money then? Most people will tell you 2 ways:
1. Increase debt i.e. borrow more
2. Increase revenue i.e. raise tax
But let me add:
3. plug leakages and wastes to reduce expenses
perhaps do even all 3
But how do we get more money then? Most people will tell you 2 ways:
1. Increase debt i.e. borrow more
2. Increase revenue i.e. raise tax
But let me add:
3. plug leakages and wastes to reduce expenses
perhaps do even all 3
My concern stems from the fact that it doesn't seem like this govt is taking my future seriously as government seem swathe rcomfomrtable maintaining a very bloated status quo amidst a dire outlook for the future
Youth un/underemplyment is about 55%, poverty rate is over 70%
Youth un/underemplyment is about 55%, poverty rate is over 70%
There's a lot of work to do but I do not see that the priority levels of govt is appropriate.
The priorities of helping a homeless and hungry man has who's been hit by a car & has a fracture that's severed his femoral artery changes drastically from bread and house to HOSPITAL
The priorities of helping a homeless and hungry man has who's been hit by a car & has a fracture that's severed his femoral artery changes drastically from bread and house to HOSPITAL
Though he still needs food and a home, if the bleeding isn't stopped in a few minutes, he'll be dead!
Only an idiot will priorities paying the chaps rent instead of getting him to hospital
We have many thing s to deal with, but we need to set our priorities straight and sadly,
Only an idiot will priorities paying the chaps rent instead of getting him to hospital
We have many thing s to deal with, but we need to set our priorities straight and sadly,
...the FGs reaction to the #EndSARSProtest just seems like they are tone deaf to the aguish and agony of the citizens and intend to carry on like everything is absolutely okay...
What else needs to be done to get their attention to correct all these anomalies?
What else needs to be done to get their attention to correct all these anomalies?
