[stop-imf] Nigeria gives itself debt relief

[Robert Weissman]

Sorry, I don't have a proper citation for this clip.

>
>FG slashes $2.1b debt servicing budget
>
>Monday 19th August, 2002
>By Sanya Adejokun
>
>ABUJA — THE Federal Government is cutting down
>substantially on its external debt servicing to enable
>it commit more resources to the welfare of Nigerians,
>according to Chief Economic Adviser to the President,
>Dr. Magnus Kpakol.
>Government made a provision of $2.1 billion for external
>debt serving this year.
>"Our commitment to debt service remains high, but right
>now and given our budgetary constraints and Supreme
>Court ruling, we must first ensure that the welfare of
>the average Nigerian is assured," Dr. Kpakol told
>reporters in Abuja.
>But he did not say by what percentage government would
>cut down on the $2.1 billion set aside the year.
>He lamented that despite spending huge sums of money on
>debt servicing, the burden had refused to reduce because
>of some spurious penalty payments.
>He urged the understanding of Nigeria’s creditors,
>saying Nigeria would continue to strive to meet its
>commitments. He cited Israel to which Nigeria has paid
>all its debt.
>"We will continue to service our debts but the rate will
>be slowed down in view of dwindling resources and since
>our commitment is first to Nigerians, we will have
>difficulties in meeting our obligations promptly," he
>stated.
>The chief adviser also spoke on the privatisation
>programme, saying that contrary to wide-spread belief,
>the administration was not privatising for its sake.
>"We will privatise whenever we see a need to do so," Dr.
>Kpakol said, and declared that the country’s ports would
>not be fully privatised. The government is not
>privatising everything it sees. For example, we are not
>privatising the ports as some people have falsely
>reported. Instead, we are enhancing private activity at
>the ports to make them more efficient. The government
>will always own the ports.
>"What we are attempting to do is to ensure efficiency,
>which will allow us to produce and provide more for our
>people. NEPA was literally in a mess before this
>administration came in.
>LPOs were attended with duplicates and even multiple
>payments, which went into pockets and quite often
>carried overseas."
>On the 2002 budget, Dr. Kpakol said "it is being
>implemented as fully as possible," adding however,
>that "a budget is merely a proposal stating that we will
>spend so much if we earn so much in income over a given
>period."
>But he said a slower pace of revenue accrual was
>hampering the budget implementation.
>"When the budget was being prepared, we anticipated the
>repatriation of some loot money worth about $1 billion.
>We also anticipated a lot more from privatisation
>proceeds. While these are still expected, it is now
>September and the loot money has not come," he stated.
>This, he said, necessitated a re-prioritisation of the
>capital expenditure and overhead spending to ensure that
>only the most essential activities were attended to
>first.
>Kpakol emphasised, however, that there was a structural
>shift taking place in the economy which had created some
>dislocations affecting some people and clarified that
>these are two kinds of people. One kind of people that
>have been affected are those that used to get easy money
>from government coffers. President Obasanjo has shut the
>door on these people. It is no longer business as usual.
>"Unfortunately, some Nigerians innocently depended on
>these people, for very little crumbs that fell of their
>table. These innocent Nigerians are also crying
>mistakenly. They need to wipe their tears. There is real
>hope for them.
>"We will make sure that salaries are paid. And this is
>being done. But please note that the President is not
>holding any money anywhere. Every naira that can be
>released is being released," he declared.
>He also explained the rationale behind the supplementary
>budget which President Olusegun Obasanjo submitted to
>the Senate last week. He said it was "to achieve the
>goals set by the administration when it proposed the
>2002 budget."
>He said that some items were left out of the original
>proposal. "Some of these are very important and can
>affect the national image and even business opportunity
>at home."