External borrowings is like a gift to Nigeria – Minister

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Minister of State, Budget and National Planning Prince Clement Agba, has said that federal government external borrowings is like a gift to the country due to favourable conditions and payback period attached to it.

The minister said this at the weekend at Community Primary School, Lejja in Nsukka Local Government Area of Enugu, while addressing the people during his on-the-spot assessment of Nsukka-Lejja-Aku 7.5km road which is under construction courtesy of Federal Government Covid-19 Rural Road Intervention Project.

He said that people needs to understand the terms and conditions of the loans and what they are being used for, adding that most of the loan has 3 per cent interest rate with ten to twenty years moratorium.

According to him, “a lots of people are talking about Federal Government borrowings, they need to understand the terms and condition for the loans we are taking and what they are being used for.

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“What is bad is when you go and borrow to eat, that is for consumption, but when you borrow for something that is productive you eventually get benefits from it.

“the interest rate we are paying for this loan we are taking are not up to 3% and we have 10year, in most cases 20 years moratorium attached tobit, what it means is that within those 10, 20 years we are not paying anything, and some of this loan are taking up to 40 years to pay.

“For those who understand basic economics, there is what we call time value, so if you look at what it will take to pay back later, what the interest will be then, then you will understand that the money we are taking now are just gifts,” he said.

The Minister further stated that federal government is currently connecting rural roads through urban roads to railways across the country to help farmers and rural dwellers to transport their agricultural produce to urban areas.

“You see we are spending a lot of money on road construction across the country, but if we did not develop our real sector our road will continue to fail and the reason is because it carries heavy tonnage.

“You know that in other parts of the world they move heavy things by rail and that is what we are trying to do, to reduce the pressure on our road.”

On the notion that President Muhammadu Buhari does not like the Igbos, the Minister said, “the roads that are being constructed now are in Igbo land, the second Niger bridge that the past administrations kept on budgeting for and never did anything about it, is it not in Igbo land?, Is it not Buhari’s administration that is funding it?.

“Mr President is committed to ensuring that the bridge is completed by by the time him tenure will finish, and he has equal love for all zones and tribes in Nigeria.

“Again, I have to inform you that the second longest bridge in the country after the 3rd Mainland bridge Is complete, they are doing few roads around it and it will be connecting the North East to the South East across the River Benue.

“So, when you hear of borrowing borrowing borrowing, I need you to know and understand what the money is been used for,” he said.

He also said that the main reason for the COVID-19 Government Intervention Program was to ensure “that we activated things in the country, keep employment going and ensure that more people were employed.”

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