By Modupe Gbadeyanka
Minister of Finance, Mrs Kemi Adeosun, has disclosed that Federal Government will continue to borrow from international organisation because it was cheaper than domestic borrowing.
While addressing lawmakers last week, the Minister said it would be extremely difficult for the government to meet obligations in capital budget, pointing out that there was N2.3 trillion deficit in the 2017 capital budget.
Mr Adeosun noted that the 2017 budget deficit was projected mainly on external and domestic borrowing.
She hinged further capital releases on how fast the government could push the borrowing process, adding that domestic borrowing would not be enough to fund the gaps in the budget.
The Minister stressed that the cost of domestic borrowing was getting too high, saying borrowing from foreign sources was far cheaper than local sources.
She said foreign loans come with fewer interests and on longer tenures.
The Finance Minister put cumulative releases on Recurrent Expenditure at N1.5trillion, Statutory Transfers N128.8 billion; Funds for Pensions, N37.8 billion; Overheads, N92.4 billion; Service Wide, 223.6 billion; and Capital Expenditure, N340.9 billion.
She said, “There will be no stoppage in terms of capital releases and projects simply continues. The administration is focusing on completing prioritized projects that were critical to the administration. So we will keep the capital going to ensure that the projects are not disrupted from completion.”
Mrs Adeosun disclosed that revenue realized at the end of June represented a total of 91 percent of the projected revenue for the first half of year.
