Nwankwo, who put Nigeria's Gross Domestic Product between $178bn and $179bn, added that the country's current internal and foreign debts were $29bn.

The DMO boss, who featured on the News Agency of Nigeria Forum on Sunday in Abuja, explained that the said loans were obtained by the then central and regional governments.

But he did not state the amount that was borrowed by the country between 1965 and 1970, and thereafter.

He explained that the loans, were spent on roads construction, building of houses of assemblies, agricultural facilities, universities and other tertiary institutions of learning in the country.

"Indeed, if you go to our loan books now, which are available for public scrutiny, you will find out that some of the loans we have in our books now were borrowed in 1965, 1968 and 1970,'' he said.

The DMO chief added, "It is on record that the loans were specifically used to build major roads, monumental houses of assemblies in Kaduna, Enugu, as well as in Ibadan. We have the details of some of the moneys that were borrowed in 1960.''

Nwankwo said he was in custody of the record of the country's national development plans of the 60s and 70s in which the central and regional governments issued development loan stocks.

"Borrowing is not new to Nigeria and indeed, as I said earlier; borrowing is an integral part of a modern economy,'' he added.

Nwankwo explained that, "We are owing $4.27bn as external debt at the end of June 2010.

"Domestically, at the end of June 2010, Nigeria is owing N3.76tn.

"If you combine the two under one denominator, in dollars, the total public debt as at the end of June 2010 is about $29bn.''

He said that 85 per cent of the external debt was from the concessionary window of the World Bank and the soft window of the African Development Bank

"These are windows where the total finance charge of what you have borrowed is not more than 1.25 per cent per annum,'' he added.

The DMO director-general further explained that loans from the concessionary window had longer repayment periods.

He condemned what he described the "brandishing" of wrong figures on Nigeria's debts, stressing that the DMO was the only agency allowed to comment on the volume of the debts.

"The DMO is the only agency that can tell you how much Nigeria owes externally and domestically,'' Nwankwo said.

In 2006, Nigeria's external debt stock dropped substantially from $35.94bn to $3.54 after she repaid a substantial portion of her debt and exited the Paris and London clubs.

Nigeria had paid $12.4bn to the Paris Club in exchange for a debt cancellation of an estimated $18bn, representing about 60 per cent of the $30bn owed the club creditors.

The Federal Government also paid $2.3bn of the London Club debt in two batches of $1.4 and $900m

The Paris Club debts are government-to-government credits or market-based loans which are guaranteed by the various export guarantee agencies of the creditor countries.

The London Club is a group of commercial banks that jointly negotiates the restructuring of the claims against debtor countries.

Nigeria's debt rose to $3.95bn at the end of December 2009, including the $3.69bn obtained from multilateral organisations, including the World Bank, African Development Fund, International Development Association and African Development Bank.

Nwankwo described the DMO as a permanent feature of every emerging economy because governments all over the world, no matter how developed, needed to borrow to fund major projects.

He said, "In this way, you are in the position to fast-track development; this explains why even countries like United Kingdom, United States, France and Germany that are so well advanced still borrow domestically and externally."

Nwankwo said more than 90 per cent of private companies worldwide could not function unless they borrowed, noting that it made sense for them to borrow to expand and enlarge their turnover.

According to him, it therefore makes sense for government as an economic agent to borrow to accelerate growth and development.

However, Nwankwo stressed that borrowed funds must be used judiciously to execute the projects they were borrowed for.

"We have to ensure that the proceeds of borrowed funds are used in such a way that they generate maximum output, maximum growth, maximum employment, maximum poverty reduction,'' he said.

Nwankwo also spoke on the fiscal responsibility law, saying that it was enacted in 2007 to ensure that individual firms, public officials and organisations were held accountable for the way public resources were spent.

He said that the law specified procedures that would ensure that funds were expended only on items explicitly captured in the Appropriation Act.

According to him, the law also provides for individuals to have the liberty to seek the interpretation of the law in court when funds are not spent in line with the expenditure projection.

Nwankwo further said the fiscal Act also emphasised the need for public sector borrowing to be controlled.

He, however, did not expatiate on the GDP which he put at between $178bn and $179bn.