Senator Orji Uzor Kalu, former Abia Governor, warned that Nigeria’s economy risks collapse without sustained borrowing, speaking at a Senate budget review in Abuja.
Kalu, chair of the Senate Privatization Committee, said the ₦98 trillion 2025 budget, with a ₦34 trillion deficit, relies on $2.7 billion in loans to fund infrastructure and social programs. He argued Nigeria’s $500 billion debt, at 30% of GDP, is sustainable compared to Japan’s 250%, citing $10 billion in road projects since 2023 as loan-driven successes.
Kalu acknowledged public concerns over debt servicing, consuming 40% of 2024’s ₦28 trillion revenue, but insisted loans are critical to bridge a $50 billion infrastructure gap. Critics, including the Debt Management Office, warn of repayment risks, with $15 billion due in 2026.
Nigerians, grappling with 40% inflation, fear further borrowing will raise taxes, as fuel prices hit ₦1,200 per liter. Kalu urged diversification, noting oil’s 80% revenue share, and proposed privatizing refineries to save $5 billion annually. His stance aligns with Tinubu’s $25 billion borrowing plan for 2025, but public protests in Lagos highlight resistance, demanding fiscal restraint.
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