Seadogs Alarmed Over Nigeria’s Rising Debt Profile

The National Association of Seadogs (Pyrates Confraternity) has raised the alarm over Nigeria’s rising debt profile, saying such borrowings could further sink the economy. 

The group, in a statement by the NAS Capn, Dr Joseph Oteri, said President Bola Tinubu’s latest $2.209bn external borrowing request to partially finance the 2024 budget deficit of N9.179trn, which the National Assembly has approved, was worrisome and raised critical questions about Nigeria’s fiscal trajectory, debt sustainability, and economic strategy.

In the statement titled: It’s time to ask questions about FG’s endless borrowing, the association blamed the federal government for relying mainly on crude oil exports as its source of revenue.

The President had hinged his latest request for a loan on giving more impetus to the ongoing implementation of projects and programmes in the 2024 Appropriation Act, designed to stabilise the economy.

However, the Pyrates Confraternity argued that citing the provisions of the Debt Management Office (DMO) Act of 2003 to explore Eurobounds, Sovereign Sukuk, and syndicated loans to secure the funds does not sit well with Nigerians, as it underscores the urgency of addressing deeper structural issues in Nigeria’s economy.

President Tinubu recently reported that Nigeria’s debt service-to-revenue ratio has decreased from roughly 97 percent to 65 percent since May 2023. 

The association, however, noted that Nigeria remains plagued by the present administration’s incorrigible borrowing habits. 

The statement read in part, “As of June 2024, the DMO reported that Nigeria’s total public debt had hit N134.3trn, putting the country at a debt per capita of N619,501 for 216.7 million Nigerians. 

“In three months (March 2024- June 2024), Nigeria’s debt profile rose by N12.6trn. This steep rise is partly due to recurrent budget deficits, borrowing to fund infrastructure and an overreliance on external loans.

“The long-term fiscal risks of such venture are not limited to debt servicing costs, exchange rate pressure, and reduced budgetary autonomy. They outweigh any benefits peddled by the proponents of this administration’s incorrigible borrowing habit.  

“Nigeria has a debt service-to-revenue ratio of roughly 60 percent. The implication is that there must be more room for critical developmental projects. The future is bleak for Nigeria’s fiscal sustainability, with projections of 26.7 per cent rise in debt servicing costs from 2025 to 2027.”

The National Association of Seadogs stated that it was time to ask critical questions about how we manage our financial resources. 

“It is disheartening to learn that these debts are incurred to feed recurrent expenditure and the lavish lifestyles of politicians.  

“The President’s earlier promise to cut down on the cost of governance has not only been abandoned but has greatly worsened. This evokes the unfortunate picture of politicians feeding fat on the misfortunes of citizens,” the statement added.

To ensure that unborn generations are not weighed down by endless debt servicing, the association has called on the government to stop further borrowing plans to fund its overly bloated expenditures. 

“We reject the Federal Government’s inability to cut down the cost of governance drastically. We ask the people’s representatives to lead by example by taking pay cuts, minimizing travels, and driving the cost of governance downward,” the statement added.

The group implored the government to seek ways of improving Nigerians’ earning potential. 

“Efforts should be targeted at how the average Nigerian can be more productive, not how the government can lounge in largesse,” it added.

The Pyrates Confraternity argued that this humanistic approach to governance in Nigeria will ensure that the government keeps its most important mandate and with it lessen the debt burden.

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