The Rationale For Raising External Loan

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Nigeria and indeed almost all the African countries are now facing an unprecedented debt crisis never known in the history of the continent. The rationale for raising external loan has always been to bridge the domestic resource gap in order to accelerate economic development. This is because nations just like individuals need loans to augment domestic resources. Nigeria decides to borrow in order to finance specific projects. As at today, Nigeria Local and international debt stands at US $60 billion according to The Vice President Yemi Osinbajo. Nigeria debt did not just happen overnight because during some of the successive governments and administration since Nigeria independent from the periods of General Obasanjo’s regime (1976-1979) till Babangida and Abacha regimes (1985-1998), surprisingly, caused the nation’s ‘boast’ to begin to fade. Then, it was discovered that to keep moving, Nigeria had to take foreign loans. In no time, Nigeria was caught up in a crippling foreign debt crisis that besides compromising its economic progress, political stability, social dignity and cultural integrity, also dealt a debilitating blow to the Nigerian masses. Because of the pains and sufferings they inflicted as a result of implementation of the World Bank IMF policies. Another feature of the crisis is the continued negotiations for rescheduling of the debts (Mimiko, 1997:50). Nigeria made so many frantic efforts before she could be granted debt forgiveness. Nigeria was, however,

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