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The Federal Government has warned of the consequences of Nigeria relapsing to a debtor country soon after settling her external debts, calling attention to a total of $3.3 billion (about N390 billion) concessional foreign loans taken from various world lending organisations between 1999 and 2007.

The Federal Executive Council, which held its last meeting for the year, in Abuja on Wednesday, under the chairmanship of President Umaru Yar’Adua, reviewed the situation and the various loans, raising concern that the Federal Government directly took $1.3 billion of the total loan with the balance of $2.3 billion taken by some states to fund some of their projects in the health and educational sectors, among other areas.

The Minister of Finance, Dr. Shamsuddeen Usman, who briefed State House correspondents on the outcome of the meeting, expressed the council’s anxiety that Nigeria stood the risk of relapsing to a debtor country except conscious effort was made to halt the trend of borrowing.

He said the council’s concern emanated from the fact that the concessionary loans were not without some conditionalities attached to them and called for strict monitoring of the various projects for which the loans were obtained to ensure they were utilised for the purposes for which they were taken.
“Obviously, there were some concerns that Nigeria should not slide back into a debtor nation”, he stated, while, however, justifying the need for some loans as government alone would not fund all its developmental projects.

The minister also announced the decision of the council halting further approval of 2007 budget projects, because it was considered inappropriate to do so “when, in fact, the 2007 itself is due to expire in the next few days”.
In line with this, he said a total of 27 contracts brought to council for approval from the 2007 budget were stepped down, noting that 2007 budget would cease to apply the day the National Assembly approves the 2008 budget.

He said: “So, it was felt it was really inappropriate because it is really not good budgetary practice. Therefore, we are going back to doing things the right way, unlike what was done in the past. This means as from December 31, all ministries, departments and agencies are going to be asked to return all unspent money from 2007 budget and it is only what is appropriated by the government in the 2008 budget that will be spent in 2008.

“So, we are getting back to the legal way of doing things and to the proper budgetary practices that should be observed. Discussion was on how to improve budgetary performance. We are going to be looking at all the bottlenecks that exist in the system today, whether they are from the due process office, or the accountant-general’s office or the MDAs”.

The minister hinted that henceforth, budget implementation would be strictly monitored, such that by September or October, a large chunk of the budget would have been implemented, unlike the past practice.

The Minister of Information and Communications, Mr. John Odey who, as usual, coordinated the briefing, announced the council’s approval of N109.1 million for the Ministry of Health to pay for the 100,000 dosages of cerebra spinal meningitis vaccines given to the 2007 Hajj pilgrims.

Another major decision of the council is the ratification of the anticipatory approval of N1.5 billion given by President Yar’Adua to the Ministry of Health to fund the November round of polio immunization as well as the N766.6 million for the repairs of the Third Mainland Bridge in Lagos.