The federal government has defended the country’s position with regards to foreign borrowing which the International Monetary Fund IMF listed the vulnerability to foreign debt as one of the major threats to economic growth amongst African countries, especially in the sub-Saharan group which includes Nigeria.
The government also stressed why reserves are falling, attributing the fall in reserves to the rising interest rates in developed economies.
Meanwhile, the Debt Management Office (DMO) of the Federation has said that the federal government is making effort to protect the country from such crisis.
The Director in charge of Africa at the IMF, Mr Abebe Selassie, who listed the challenges to growth in Africa said the countries’ debts were rising unsustainably, posing threats to their ability to deploy funds for economic development.
He also said that the consequences of the rising debt were the countries’ resources were being channeled to debt servicing rather investment into growth enablers.
Selassie advised that not only should the debts be moderated but also that revenue generation should improve to address a weak debt servicing ratio to GDP and tax-to-GDP ratio.
But against the backdrop of this situation the Director-General, DMO, Ms Patience Oniha, while addressing journalists on the sidelines of the on-going annual meetings of the Bretton Woods institutions, said the Federal Government is on top of the situation in the borrowing plans.