Minister of finance, Kemi Adeosun, has spoken out in support of the proposal for Nigeria to sell off some of its national assets to raise funds to reflate the economy out of recession, saying the move will reduce government borrowing.
Adeosun made this comment during a meeting with business editors of some national dailies in Abuja over the weekend.
She said the federal government, after undertaking a medium term expenditure framework and debt strategy, discovered that the country can no longer rely on borrowing to finance infrastructure development as a result of its accumulated deficit.
‘‘The infrastructure challenges we face are so serious and the kind of money that we need, we can’t borrow because when you have an accumulated deficit, you need to look for the money that will sustain what you are doing for the next three to four years. So, that is what we are looking at and having a more strategic approach so that, over time, we will borrow less, which, of course, is good in the long run,’’ said the minister.
While answering questions on the suitability of selling off some national assets when some that had been sold in the past had not been properly managed, she said: ‘‘I think there are lots of assets being considered. There are some unused assets that are just lying idle and people have come and said, ‘These things you are not using, can we lease it from you?’
‘‘I think when you are looking for money, some things that government is sitting on, we don’t have money to do them and so it makes sense for me to unlock those things as it will bring money to the economy at these difficult times so that we can move forward.
I don’t think we have got to the stage where we say it’s this or that asset. The conversation now should be: should we just keep borrowing, or now that things have got to this stage, we should start to dislodge some under-utilized assets. And it’s not exclusive to us: Saudi Arabia is selling some of its oil assets. So if you sell an asset and use it to finance another asset which is going to give you more, then I don’t have a problem with that.’’
Adeosun also disclosed that there are some assets that can be leased out and there are some which may need to divest.
‘‘The investor will need to look at the risk and pricing accordingly. We can sell to the Nigerian people or the pension fund and you can also list these assets on the stock exchange. So there are different types of sales,’’ she explained.
LEADERSHIP reports that there has been a raging debate over whether Nigeria should sell some of its assets to raise funds to help the country out of recession.
The Manufacturers Association of Nigeria (MAN) and Nigerian Association of Chambers of Commerce Industry, Mines and Agriculture (NACCIMA) recently endorsed the move while the Nigerian Labour Congress (NLC), the Trade Union Congress (TUC) as well as many Nigerians opposed the proposal, describing it as a threat to the economic independence of the country.
The National Economic Council (NEC), the highest economic decision body, which is chaired by the Vice President Yemi Osinbajo, had last week said it was considering the sale of some national assets to revive the country’s ailing economy.
Similarly, Africa’s richest man, Aliko Dangote; governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, and the Senate president, Bukola Saraki, have also suggested the sale of some national assets, saying this will provide the cash to reflate the economy, reopen factories and put money in people’s pockets.
