PENGASSAN raises concern over Nigeria’s rising debt and energy crisis

The Nigerian Petroleum and Natural Gas Senior Staff Association (PENGASSAN) has called the country’s present debt profile, estimated at N77 trillion, frightening and calamitous.

The 2023 budget, it was claimed, would fail because the cost of servicing the debt would consume the entire nation’s annual earnings.

The union specifically stated that the present debt profile as of the first quarter of 2023 was staggering and that it might take several generations to repay them.

The association also raised alarm over what it termed as troubling data from the Food and Agriculture Organization of the United Nations (FAO) forecast that around 25.3 million people in Nigeria may experience food insecurity between next month and August of this year.

However, Mr. Peter Obi, the candidate of the Labour Party for president in the general election of 2023, claimed that if the country’s future government truly made use of the huge resource potential that exists there, the situation might be permanently altered.

Festus Osifoh, president of PENGASSAN, said the union was deeply concerned about the current status of the economy while speaking at the beginning of the 7th Triennial Delegates Conference, which got underway in Abuja yesterday.

He said the situation had become so bad that Nigeria would be using virtually all the monies generated as a country to service her debt.
Osifoh said: “According to the Debt Management thce (DMO), the country’s total public debt profile, representing the domestic and external debt stocks of the federal government, the 36 state governments and the Federal CapitalTerritory (FCT) currently stand at N77 trillion.

“This is quite alarming mostly when you compare the cost of servicing this debt to the revenue generated by government per annum. In the 2023 budget for instance, we will be using virtually all the monies generated as a country in servicing our debt. This is a calamity of the highest proportion unless we do all we can to increase the revenue base.”

PENGASSAN stated that while it was not opposed to the federal government borrowing money, the money should instead be used for productive endeavors and infrastructure development rather than for consumption.
According to Osifoh, PENGASSAN anticipates that the incoming administration will adopt a different strategy when it comes to enacting responsible fiscal and monetary policies for the nation.

“The current state of our economy is of great concern to us as we had hoped to see steady growth in our GDP, increase access to employment for our teeming population and diversification of the economy but unfortunately, we are yet to achieve this.
“Poor implementation of both fiscal and monetary policies; policy inconsistencies have continued to militate against our projected growth and development as a nation,” he said.

Gas and Oil Sector and Economic Sustenance

According to Usifoh, “the nation’s economy is confronted with many serious challenges like structural imbalance, corruption, weak human capital development, inequality, security challenges and excessive dependence on oil for revenue.”
In addition, Osifoh lamented the high youth unemployment, which he said was recently highlighted by the International Labour Organization (ILO).
He said underemployment and poor infrastructural facilities were some of the key challenges the new government should tackle with sound and coordinated strategy in consultation with relevant stakeholders and industrial experts.

Speaking on how to turn around the economy, the PENGASSAN president said: ‘”The hard truth is that revenue from oil and gas sector can no longer sustain us as a nation and this is the most auspicious time to walk our talk. We commend the ongoing efforts of government in agricultural sector and expect the tempo to be sustained in the entire value chain and replicate same in other areas like solid minerals, tourism, technology, etc.”

Osifoh also charged the incoming administration to ensure the completion of the ongoing rehabilitation of the nation’s petroleum refineries and to adopt the NLNG model in the running of the four refineries.