As FG earmarks N4tr for subsidy
The global financial institution, the World Bank, has warned Nigerias increasing fuel subsidy could pose debt sustainability concerns for the country.
The Bank disclosed this in its latest Africas Pulse report, a bi-annual analysis of the near-term regional macroeconomic outlook.
The warning comes on the heels of the National Assembly’s approval of President Muhammadu Buharis request to earmark N4 trillion for petrol subsidy.
According to the report, Risk remains high on increasing fuel subsidies, which could weigh heavily on public finance and pose debt sustainability concerns”. “Nevertheless, public debt as a percentage of GDP is currently moderate, it, however, stated.
The Washington-based institution added that the countrys soaring military spending and debt servicing costs could prey on the countrys debt sustainability level.
On sub-Saharan Africas recovery, the Bank noted that it is multi-speed, with wide variation across countries.
According to World Bank, growth in Nigeria is forecast to increase to 3.8% in 2022 and stabilise at 4% from 2023 to 2024.
