Former Deputy Governor of the Central Bank of Nigeria, CBN, Professor Kingsley Moghalu, has said that the plan by President Muhammadu Buhari to borrow a fresh $800 million loan from the World Bank is unsustainable and should be left for the incoming administration to decide on.
Speaking in an interview on Channels Television on ‘Economic Agenda for the Incoming Government’, monitored by Vanguard, in Lagos, he said it’s inappropriate for President Buhari to be taking on liability for the incoming government, considering how late in the day it is in his administration.
He noted that what is germane would be for the incoming government to focus on revenue generation, saying that Nigeria cannot borrow itself out of its present crisis.
Moghalu insisted that fuel subsidy is anti-people, wasteful, not efficient and based on a superstition that it helps the poor.
He further argued that subsidy payment makes the government broke everyday.
He said: “I am one of those Nigerians that think that Nigeria is borrowing too much. I don’t think it’s right to borrow money to pay subsidies, because that is not a sustainable approach to the matter of subsidy removal.
“But, since it’s nothing new, according to the Ministry of Finance, it seems that they have already reached that agreement. I think it’s more appropriate, given how late in the day for the outgoing administration. It will be more appropriate for the new administration to make its own decision as to how it wishes to go about this obligation in terms of subsidy removal.
I think it is too late in the day to be drawing down that loan.”
He stated that administration of subsidies has not had any impact on Nigerians and poverty level.
“I think it’s more about what’s right in terms of social safety net administration in Nigeria. There are lots of good intentions, but the record is not very encouraging. There is also evidence that there has been a lot of fraud in many of these schemes.”