The Minister of Finance, Kemi Adeosun, said the Federal Government would only borrow from the lowest cost debt providers to fund the deficit in the 2016 budget.
Adeosun said this on Thursday in Abuja while addressing the Senate Committee on Appropriation, chaired by Senator Danjuma Goje.
She said the decision was for government to easily service the debts as high cost debts would be counter productive in view of the nation’s economic realities.
She said: “We know that there is a need, because of the budget deficit, to borrow, but what I will like to assure you is that borrowing is going to be as responsible as possible.
“What we have done is to approach the lowest cost debt providers first.
“We have secured loan with the China Exim Bank at less than two per cent.
“We have secured loan facility with World Bank 1.5 per cent concessioner loan with long moratorium period before we have to start repaying and at low interest rate.”
The minister added that the Ministry had made some projections around the nation’s revenue beyond the use of the sources of revenue, which were oil proceeds, customs and taxes.
She said to fund the 2016 budget, independently generated revenue would be quite significant in financing it.
Adeosun said: “We believe that is one of the opportunities that the lower price has given us that we are now focusing on the non-oil revenue.
“We are aggressively looking at Ministries, Departments, Agencies on board to understand what their true revenue base is and to know how much they are contributing to the wider economy.
“We have set in process in the Ministry of Finance a very rigorous framework of revenue management and to actually monitor revenue.
“We are beginning to roll those out into other agencies of government that collect revenue of any description.”
NAN.
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