National Telescope national telescope newspaper
By David Olusegun
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has voiced strong disapproval of the Federal Government’s plan to secure a $500 million loan from the World Bank aimed at supporting basic education.
On September 26, 2024, the World Bank approved $500 million for the HOPE-GOV initiative and an additional $570 million for HOPE-PHC.
According to the Programme Information Document obtained by PUNCH, formal approval for the loan is expected by March 2025.
In a statement titled “Where Are the Savings from Subsidy Removal?” issued by its National Publicity Secretary, Dr. Joseph Obele, PETROAN raised alarms about the government’s continued reliance on loans amidst Nigeria’s growing debt crisis.
Dr. Obele reminded Nigerians that President Bola Tinubu had promised to lessen the country’s dependence on borrowing for public spending.
He had assured citizens that the removal of fuel subsidies would lead to significant savings, enabling better investment in critical sectors like education, healthcare, and job creation.
The association noted that many Nigerians were taken aback by the government’s persistent requests for external loans totaling billions of dollars.
Dr. Obele emphasized that while borrowing can be advantageous if directed toward productive endeavors, it becomes harmful when used for consumption.
“In Nigeria, loans are frequently utilized to cover excessive expenditures, which ultimately damages the economy.
Borrowing should ideally be focused on boosting production, creating jobs, and enhancing food security,” he said.
He criticized the current cycle where borrowing is used primarily to pay salaries and service existing debt, leaving little room for necessary investments and hindering future economic growth.
Dr. Obele warned that this pattern could trap the government in a cycle of borrowing to repay previous loans, further stifling economic development and contributing to rising inflation.
He urged the Federal Government to prioritize cutting unnecessary expenses and reducing frequent borrowing, warning that the increasing burden of external debt poses a serious risk of bankruptcy for the country in the coming years.
