A former Finance Minister, Seth Terkper has cautioned the government against jubilating over recent economic gains, saying, the economy has not yet turned the corner.

According to him, the government needs to avoid past complacencies in dealing with performance of the economy.

“No need to be jubilant—the view that we have made progress is premised on the sacrifice and largesse of domestic bonds and external lenders (bonds/loans) that has suffered and will suffer haircuts”.

According to him, data from the fiscal, financial, monetary & macroeconomic data indicates that the economy is far from its troubles.

He pointed out that legacy may not make the country third time lucky after HIPC and therefore the country should not have defaulted again.

“Path to domestic and external financial markets remain blocked—as we depend on Treasury Bills & short-term notes to finance the budget.  As the debt restructuring outcomes are confirming, the Government is leaving the “heavy lifting” to successor governments & generations—whose “reserves” and “buffers” are depleted”, he disclosed.

According to him, there is the need for sober reflection—as a nation, this legacy of default, after HIPC, is not likely to make us a 3rd time lucky.

He expressed concern about using primary balance as key performance criteria, saying, “We are convinced that the use of primary balance, given the International Monetary Funds data, will make us complacent again”.

He added that data and graph show that the “primary balance” is inferior and less critical for a country that has defaulted and aiming for debt forgiveness.

Restoration of sinking fund good but too late

He welcomed the restoration of “sinking fund” but said it was too late for immediate future. This is due to significant “humps” between 2026 and 2028.

Mr. Terkper continued that the best public debt performance of nearly 70.0% is expected in 2028 compared with 57% in 2016.