President Muhammadu Buhari has revealed that his regime will embark on fresh borrowings to fund the 2023 budget deficit.

“We plan to finance the deficit mainly by new borrowings totalling N8.80 trillion, N206.18 billion from privatisation proceeds, and N1.77 billion drawdowns on bilateral, multilateral loans secured for specific development projects and programs,” said Mr Buhari.

While presenting the 2023 appropriation before the National Assembly, Mr Buhari blamed the country’s debt profile on the two recessions that hit the country under his watch.

 He added, “We expect total fiscal operations of the federal government to result in a deficit of N10.8 trillion. This represents 4.78 per cent of the estimated GDP above the three per cent threshold set by the Fiscal Responsibility Act of 2007. As envisaged, we will need to exceed this ratio, considering the need to continue to tackle the existing security challenges facing the country.” 

Mr Buhari explained that since his regime resorted to borrowing to finance “our fiscal debts, we have been using the loans to finance critical projects and programs and further improve our economic environment and enhance the delivery of public services to our people.” 

He further stressed the recession had resulted in “the significant decline in our revenue generation capacity,” but said, “we had to spend our way out of recession resulting in higher public debt and debt service.”