Home NEWS Finance: Nigeria in serious financial trouble says Obaseki

Finance: Nigeria in serious financial trouble says Obaseki

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A huge row appears to be  brewing between the federal government and Governor Godwin Obaseki of Edo State following  the governor’s claim that Abuja printed N60 billion to supplement the federal allocation to the three tiers of government for March.

Obaseki told his state transition committee stakeholders at a meeting in Benin on Thursday that the printing of the N60billion was an illustration of the poor state of the national economy.

A top official of the Federal Ministry of Finance and another official of the Central Bank of Nigeria (CBN) said last night that they did not understand what the governor was talking about.

But economic experts warned that the federal government would be doing the country a lot of disservice if it truly printed N60billion without commensurate production at home and foreign reserves.

The result would be hyperinflation, they said.

Speaking at the Benin meeting, Obaseki said: “Nigeria has changed. The economy of Nigeria is not the same again whether we like it or not. Since the civil war, we have been managing, saying money is not our problem as long as we are pumping crude oil every day.

“So we have run a very strange economy and strange presidential system where the local, state and federal governments, at the end of the month, go and earn salaries. We are the only country in the world that does that.

“Everywhere else, the government relies on the people to produce taxes and that is what they use to run the local government, state and the federation.

“But with the way we run Nigeria, the country can go to sleep. At the end of the month, we just go to Abuja, collect money and we come back to spend. We are in trouble, huge financial trouble.

“The current price of crude oil is only a mirage. The major oil companies who are the ones producing are no longer investing much in oil. Shell is pulling out of Nigeria and Chevron is now one of the world’s largest investors in alternative fuel, so in another year or so, where will we find this money that we go to share in Abuja?

”When we got FAAC for March, the federal government printed an additional N50-N60 billion to top-up for us to share.

”This April, we will go to Abuja and share. By the end of this year, our total borrowing is going to be between N15 and N16 trillion.

“Imagine a family that is just borrowing without any means to pay back and nobody is looking at that, everybody is looking at 2023, everybody is blaming Mr. President as if he is a magician.”

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