The Minister of Finance, Kemi Adeosun, has expressed confidence that the Federal Government’s revenue and debt management strategy would mitigate the country’s debt service risk and fast-track development.
In a statement by her Special Advicer on Media, Oluyinka Akintunde on Thursday, Adeosun welcomed the advice of the International Monetary Fund regarding the country’s decision to take more foreign loans.
She said that Nigeria’s further borrowings from foriegn partners would help mobilise revenue, whilst reducing the nation’s debt burden by lengthening the maturity profile.
Foreign borrowings according to her, would also increase foreign exchange reserves, reduce crowding-out of the private sector and create savings in debt service cost.
The Minister said a key element of the Federal Government’s economic reform strategy was the mobilisation of revenue to improve the ratio of debt service to revenue.
She said that this was being undertaken through a number of initiatives including the plugging of leakages and the deployment of technology in revenue management.
She also said that the ongoing Voluntary Assets and Income Declaration Scheme (VAIDS) was equally expected to impact positively on the level of tax collections.
“The difference in our economic strategy is that we are changing the mix of revenue sources available to government from the traditional oil or debt to a combination of oil, debt and domestic revenue.
“This is a long term strategic reform which is critical to our future economic growth and in the short term will enable our debt service to revenue ratio to improve,” she said.