Former President Olusegun Obasanjo has, like many other Nigerians, frowned at the increasing rate of borrowing made by the Federal Government, FG, saying it is nothing but a ‘criminal act’ and that, the borrowing attitude, will leave nothing but ‘problems for successive governments and future generations.
According to Ripples Nigeria, Ex-President Obasanjo said this on Sunday, at an event held in South Africa, where he also faulted the FG’s plan to source fresh external loans, after leaving a greater percentage of existing debts unpaid.
The octogenarian lamentations:
“FG was accumulating debts for the next generation, which is a criminal act.”
“If you want to build a commercial house, and you go and borrow money, and you have 50 percent of your own money, and you borrow 50 percent and in five years, you pay the 50 percent that you borrowed. That is a wise thing to do.
“But if you have to go and borrow money, for you to be able to feed yourself and your family, that is a stupid thing to do.
“So, if we are borrowing for recurrent expenditure, it is the height of folly. If we are borrowing for development that can pay for itself, that is understandable. Then the payment, how long will it take to pay itself?
“But we are borrowing and accumulating debt for the next generation and the next generation after them, it is criminal, to put it mildly. What are we borrowing for?”
The former President however opined that, while borrowing itself is not really a problem, borrowing without a specific project or plan in mind, is the problem; especially when there is no means of paying the borrowed money back.
Obasanjo therefore submitted that, ‘borrowing for recurrent expenditure, it is the height of folly’, but for ‘development that can pay for itself, that is understandable.’