The Explanation of the “extremely necessary for Nigeria”

The Explanation of the “extremely necessary for Nigeria”

My note: “Then praise him [President Buhari] for really good moves like closing the latest loan (extremely necessary for Nigeria)…” I had noted that it was “extremely necessary” for Nigeria to have taken the recent IMF emergency loan despite the concerns to the previous unbalanced and thoughtless one, pre Covid-19.

This is why that loan is very important:

  • NNPC was not making money due to the Covid-19 pandemic. Whenever that happens, Nigeria has a real problem. Experiencing that during a period of national health emergency compounds the models.
  • VAT & broad tax revenue was not coming because offices were shut down. Government was not having receivables because offices that were to process them were hibernating.
  • Local & international capital markets were frozen. Not many private lenders would have been open to support Nigeria with capital due to the stochastic state of the world due to Covid-19. Our poor credit rating would not have helped.  Only the IMF could have offered a way out, and it did.

So that triple whammy requires Nigeria  borrowing since we do not have money for the rainy day to fight the virus and take care of the necessary urgent bills. That loan is for a health emergency and I do think it was a very necessary loan. Sure, while we all push against some of these loans, the recent $3.4 billion is a commendable one. My fear was that not many people would lend to Nigeria. But magically, the IMF, due to the virus, reversed its position and did the right thing.

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2 thoughts on “The Explanation of the “extremely necessary for Nigeria”

  1. You just wrote as if you are in the minds of our managers, or they have assured you that they would be fiscally responsible from now onward. So it goes beyond getting a loan when you are essentially in straits, sometimes it’s even better to die, in order to live responsibly next time.

    In our National Anthem, we retort, ‘the labours of our heros past shall never be in vain’. Don’t you think their labours have already been in vain? That is if we agree that we even had heros, let alone labouring for anything.

    And in the pledge, we retort, ‘to be faithful, loyal and honest’; I mean, which of our managers know a thing about these words, let alone attempting to put them into practice?

    Like they say in our side, ‘if your salary isn’t enough for you, is it the overtime pay would do?’

    We once had some cash, we became highly irresponsible in the things of money, now with borrowed money we magically acquired sense to do away with our irresponsible lifestyle?

    I haven’t read where we made a new pledge and signed a commitment never to misuse money or resources again, if we ever come out of this hole.

    Nothing shows that we have become a new creature, so the jury is still out there…

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  2. The real issue is whether the fund will be used for the purpose. I worked in the hospital during this pandemic and no kind of protection or covering was provided for us to help us avoid contracting the virus.

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