This is my first time of posting here, tho i am a regular and nairaland addict .

Some just asked me a very simple question that I ought to have known this morning but I goofed.

He asked, does it mean Nigeria government doesn't have machine that prints money, do they also import naira ?and I answered we have, so he asked then why are we borrowing from other countries when we can print as many naira as we want and I answered, it will make naira surplus and worthless.

He said in that case naija can print as much as they are owing China and pay them back if the surplus here will make it worthless.

Please I need much deeper understanding and knowledge why countries borrow when they can easily print as much as they want for their own use.

Options like selling our refinery or what?

Tell him/her to Google search about inflation and read carefully to understand, then wait for feedback

Does this OP know about inflation
It can have very adverse effects on the economy and the naira

make dem dey borrow..imagine sey niger delta break out of nigeria next year.cos all dis borrowing na the oil go suffer am.

Sirmwill:
Does this OP know about inflation
It can have very adverse effects on the economy and the naira

Educate me and my likes more if u have wider knowledge, the little I know about inflation does not explain anything about the topic .

Theevilone:
This is my first time of posting here, tho i am a regular and nairaland addict .

Some just asked me a very simple question that I ought to have known this morning but I goofed.

He asked, does it mean Nigeria government doesn't have machine that prints money, do they also import naira ?and I answered we have, so he asked then why are we borrowing from other countries when we can print as many naira as we want and I answered, it will make naira surplus and worthless.

He said in that case naija can print as much as they are owing China and pay them back if the surplus here will make it worthless.

Please I need much deeper understanding and knowledge why countries borrow when they can easily print as much as they want for their own use.

The reason is that China gives money to the facilitator for every loan deal that is sealed. So most officials are lured to borrow from them for their personal enrichment.

Theevilone:


Educate me and my likes more if u have wider knowledge, the little I know about inflation does not explain anything about the topic .

lemme explain to you in the most dead simplest way ever.
1 naira is not the internationally agreed trade money so you cant pay back in naira
when Nigeria borrowed from china we were given in dollars not naira
for the money to be useful to us here we have to convert it to naira. And the only way is to look for someone to give us naira and take the dollars.
since we dont produce many goods here, many individuals and companies will buy the borrowed dollars with their naira so they can buy their foreign products.
2 if the government produces a lot of naira to pay their debts, who will buy the naira and give us dollars that is required to pay back since naira is not spent or required on the international scene

so the only reason to produce more naira is for the government or companies to produce international goods or services that will require our naira to produce our local products.
right now the major products we produce that fetches us dollars are crude oil and agric produce and it's not enough because what we import is greater than what we export, so we need more dollars than naira

so digest that for now
i would love to go further on how it causes inflation but you don't need that for now
peace