Emir SLS to FG: This your economic model 'Kolewerk' (It will not work)



Background

  • In his speech at the Kaduna Investment Summit yesterday titled 'Promoting Investment in the Midst of Economic Challenges', the Emir made the following statements faulting the federal government's economic model primarily because the FG is borrowing unsustainably;

  1. “The Federal Government of Nigeria is spending 66 per cent of its revenues on interests on debts, which means only 34 per cent of revenues is available for capital and recurrent expenditures"
  2. “That model cannot work. If you look at the 2017 budget of the Federal Government, I sometimes wonder what Nigerian economists are doing? In the 2017 budget presented by the Federal Government, the amount earmarked for debt servicing is in excess of the entire non-oil revenue of the Federal Government, but that is not the problem. The problem is that it is a budget that is even going for more debts.”
  3. “Growth can only come from investments. It cannot come from consumption.  It cannot come from government balance sheet. It cannot come from borrowing because you cannot borrow unsustainably”
Our take on the matter
  • O ye Nigerian Economists, we are amplifying Emir SLS's question, what are you really doing or do you know what you are doing at all?
  • Now we know where Nigerians got the habit of borrowing to buy Aso Ebi and doing parties. Like FG like the citizens. 
Conclusion
  • Federal Government, stop borrowing. Get creative, generate income and promote investment. 
  • Today, if all the oil in UAE dries up, that country will survive on tourism. Can we say the same for Nigeria?
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