“It is important that we take the loan, because I look at it as a dash. We have a grace of 10 years. There is no way you develop a nation with what we have. We should encourage the executive to take the loan.”

   Some weeks back after what seemed like a heated debate at the plenary session, the senate of the Federal Republic of Nigeria, committed to its standing committees a request for a loan facility of $3.703 billion dollars, the main purpose of the external funds is basically the provision of necessary and needed developmental projects, that are essential concerned with issues of power generation, social infrastructure such as transportation, hospitals and clean water. The floor was opened with the contribution of the senator representing Delta North from the Accord party, senator Patrick Osakwe were he stated and compared the loan facility as a free loan, thus an opportunity for Nigeria to get easy access to free money from the international financial institutions and should Nigeria not take the the facility other African and developing countries would easily take the opportunity and collect the loans, these viewpoints according to the senator from Accord party, is a belief propounded by the Honorable Minister of Finance, Dr. Olusegun Aganga.

   The concept of a loan facility pre supposes the transfer of funds from one party or institution to another, usually upon an agreed terms between the parties involved in the transaction, also it is usually within a stipulated time that the loan facility matures for repayment to the institution that lend the funds, while a gift is the transfer of funds or property from a person or institution to another without consideration, which is free transfer of funds without the expectation of anything in return except may be gratitude, thus my problem is in comprehending and situating where to put the term free loan either as a loan or a gift, as even though it is classified as loan facility yet it has the attributes and characteristics of a gift from the context of the reasoning of the legislators and affirmation of the Nigeria’s economic czar.

   The problem of the confusing assumption regarding loan facilities to African countries has always been about perception, because a government official that perceives a loan facility as free funds is likely to mismanage it, more so as the granted facility is to be utilized by a number of selected states that makes for control and effective monitoring a very hard if not impossible task, as it is evidently clear that the states are not legally under the control of the Federal Ministry of Finance as ombudsman to the acquired funds, Nigeria’s history with foreign loans is a pointer to what happens when such funds are given the impression they are free, the contributions of senator Ahmed Lawal representing Yobe South the Chairman of Public Accounts Committee at the floor of the senate, confirmed that belief when he sought to know how the $915 million dollars previously obtained loan was utilized, affirming the contention that the funds were misused by virtue of his privileged position as a legislative overseer with oversight powers.

   Before his appointment on the 6^th of April 2010, the Honorable Minister of Finance Olusegun Aganga was the managing director of Goldman Sachs International based in London, an acclaimed expert and specialist in hedge funds and equities. Thus the conception and coming into existence of the Sovereign Wealth Fund with an initial take up grant of $1 billion dollars to accessed from the Excess Crude Account, did come as a surprise to many Nigerians because in the world of international banking, a hedge fund manager is the ultimate profiteer, thus sitting funds as a foreign reserve or excess crude reserve will not excite much interest and support  of the minister, as the idea is to invest such funds in international equities that will be generating profit to the Nigerian government, as an insurance in a world of fluctuating commodities market and uncertainty in global crude oil trading.

   However any investment in hedge funds create a moral problem of responsibility to any government embarking upon such a venture, because it is a documented fact that the global economic meltdown was caused solely by activities of hedge fund managers, as their stock in trade is projective speculation that could not be reasoned within the realm of reality, thus their elevation of risk taking to such an astronomical level that investment became a game of chance or mere gambling, these evident  scenario was confirmed with the conviction many hedge fund managers in the United States of America and Mainland Europe particularly in France. As such the fear for many Nigerians regarding their common wealth is over exposure to such a risky venture as an investment in a yet to be effectively regulated equities market.

   The apparent loss of the Excess Crude Account and the eventual deflation of Nigeria’s Foreign Reserve Fund, coupled with excessive spending on comforts and luxuries to politicians, like the presidential aircraft purchase and jumbo salary packages to legislators, political appointees and senior civil servants, does not give an impression of a policy that plans for the rainy days ahead, as since the beginning of the administration its contextual character is that of a reckless spender, as against the governments of Olusegun Obasanjo that strived to pay Nigeria’s external loans and that of Umaru Musa Yar’Adua which was very thrifty in its public spending policies. After all the total sum of domestic debt is estimated at around $19 billion dollars and the impression on our principal economic manager is that of an individual is smitten with the United States of America and Western Europe’s excessive consumption patterns, However the current economic malaise afflicting countries like Greece, Ireland, Spain and Portugal should serve as a warning to Nigeria, as the foundation of our economic base does not have the strength and support of the developed economies of Europe and Americas.