Nigeria's External And Internal Debts
The Chief of Staff said that about 83.6% of the internal debts were short term loans, adding: "It should be clear, therefore, why the Government is anxious to conclude negotiations for an external loan." The Chief of Staff, Brig. Tunde Idiagbon, said that the Federal Government had made progress in recent negotiations on refinancing the country's short-term trade arrears estimated at 3,460 million naira.
He said that the export credit agencies with insured arrears, particularly with the US, UK, France, West Germany, Italy and Japan, were generally receptive to Nigeria's approach for a review and a rescheduling of the country's foreign debts. He said that the UN-insured creditors who had accepted the refinancing proposals in principle, had arrears of over 1,400 million naira.
This, according to Brig. Idiagbon, included all the major firms. He said that on the conclusion of the negotiations, the total arrears would be repayable over a period of six years, including a two and a half years grace.
The Minister of Finance, Dr Onaolapo Soleye, recently led a Nigerian delegation abroad for the negotiations. On negotiations with the IMF, Brig. Idiagbon said that although there appeared to be a consensus on the earlier conditions set by the Fund, final agreement had not been reached. He said that this was because of the IMF's insistence on a substantial initial devaluation of the naira.
He explained that Nigeria left the IMF in no doubt that such a devaluation, under the prevailing conditions in the country, would be inimical to the overall interest of the nation. The Chief of Staff said that discussions on the issue would continue when an IMF team visited the country this month and in April.
