The Central Bank of Nigeria has called on states to show more transparency in their debt management practices.
Dr. Hassan Mahmud, Director of Monetary Policy at the Central Bank of Nigeria, stated this in Abuja at a debt management training session for governments conducted by the West African Institute for Financial and Economic Management, WAIFEM, and the World Bank.
Dr. Mahmud noted that debt management has become a crucial topic around the world as more governments grapple with increased debt levels in the face of economic constraints such as rising inflation and diminishing income.
He elaborated on the importance of putting loans to good use and cleaning up the process of obtaining them.
Dr. Mahmud stated that states needed to improve openness in their debt management policies as well as increase capacity.
Dr. Mahmud described the WAIFEM training as critical to building the capacity of relevant state officers in debt management.
Earlier, the Director General of the West African Institute for Financial and Economic Management, Dr. Baba Yusuf said the training sought to address the gaps in the management of debt such as raising required amount of funding, achieving the risk plus cost objective and development of the domestic debt market and accountability.
On Nigeria’s debt situation, Dr. Yusuf said the problem was a shortfall in revenue and that if properly tackled, the country’s debt stock was sustainable.
According to Dr. Yusuf, both national and subnational debt should have an organizational structure that allows for debt portfolio analysis, as well as a legislative framework that includes explicit debt management objectives and is staffed by experienced personnel.
The first phase of training is being attended by seventeen states and the FCT.
