The presidential candidate of the Labour Party, Peter Obi has called for the need to restrict the country’s federal borrowing to a statutory 5 percent of the country’s previous year’s revenue.

“…it has become imperative to restrict Federal borrowings to the statutory 5% of the previous year’s revenue,” Mr Obi in a series of tweets on Wednesday said.

He made his remarks as the President Muhammadu Buhari administration continued to take on heavy loans to service the nation’s rising cost of governance.

Mr Obi urged the federal government to cease borrowing for consumption and instead take on loans to engage in regenerative development projects.

“As a matter of urgency, Nigeria must stop borrowing for consumption, but only borrow to invest in regenerative development projects and other productive ventures. It’s ironical that States that received fiscal bailouts did not invest them properly; did not repay the loans and are still borrowing beyond their revenue earnings,” Mr Obi advised further.

Mr Obi’s comment comes shortly after a World Bank report detailing that rising debt has pushed Nigeria up the World Bank’s top 10 International Development Association (IDA) borrowers’ list.

According to the World Bank’s recently released Fiscal Year 2022 audited financial statements for IDA, Nigeria has risen to fourth place, with $13 billion in IDA debt stock as of June 30, 2022.

Except for Nigeria, the top five nations on the list somewhat decreased their IDA debt stock.

This debt is unrelated to the $486 million loan that is yet unpaid from the World Bank taken by the country for reconstruction and development.

The report further placed Nigeria as the highest IDA debt in Africa, fourth behind three other IDA borrowers from Asia (India, Bangladesh and Pakistan).