The Federal Government will in the next three years focus more on obtaining foreign loans in the face of the dwindling income from oil and to diversify the economy.
The government is opting for external loans in order to allow Nigerian banks to assist the private sector to grow by borrowing to the sector.
The Minister of Finance, Kemi Adeosun, disclosed these to State House correspondents at the end of the Federal Executive Council (FEC) meeting chaired by Acting President Yemi Osinbajo.
She was accompanied to the briefing by the Minister of Information, Lai Mohammed and the Minister of State for Budget and National Planning, Zainab Ahmed.
According to her, the new policy is part of the Debt Management Strategy for the years 2016 to 2019 approved by FEC on Wednesday.
She said: “Today I presented a memo to the FEC which was approved for the debt management strategy for the years 2016-2019.
“Nigeria started producing debt management strategy in the year 2012 and three years debt management programme and the previous ones had expired in December 2015 and there was a need for a new one.
“There was a need for a new one for two reasons, one was that the previous one had expired and secondly, given the current economic challenges and then the economic circus of this government to reflate and diversify the economy.”
She also explained that there is a need for a new debt strategy in order to base it on the Medium Term Expenditure Framework (MTEF).
The new MTEF prepared by the Ministry of Budget and National Planning, she said, assumed that the domestic debt would reduce from one percent of GDP to 0.7 percent by 2019.
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