ECONOMIC CRISIS: Nigeria Public Debts Increase To N42.8 Trillion, As FGN, State Govts, Borrow More.

...Lenders include: IMF, World Bank, ADB; Germany, China, Japan, India and France.

BY Charles Segun Adegbite

 Nigeria total public debt stock has increased from N41.60 trillion (100.07 billion dollars) in March to N42.84 trillion (103.31 billion dollars) by June, according to Debt Management Office (DMO) report on Monday, September 19, 2022.

According to the DMO’s report published on its website, the total debt represents the domestic and external debt stocks of the Federal Government of Nigeria (FGN), the 36 State Governments and the Federal Capital Territory (FCT).

The foreign component of the debt, however, remained at the same level of N16.61 trillion (39.96 billion dollars), while the local component increased to N26.23 trillion (63.24 billion dollars).

The debt profile showed that the local component of the country’s borrowings was N24,98 trillion (60.1billion dollars) as at March 30.

 Going by the DMO reports, a larger percentage of the external debts were concessional and semi-concessional loans.

“Over 58 per cent of the external debt stock are concessional and semi-concessional loans.

THE LOAN LENDERS

 They loans were obtained from multilateral lenders such as the World Bank, International Monetary Fund, Afrexim and African Development Bank, and bilateral lenders including Germany, China, Japan, India and France.

HOW DOMESTIC DEBT INCREASED

  The DMO disclosed that the total domestic debt stock increased from N24,98 trillion (60.1billion dollars) in March to N26.23 trillion (63.24 billion dollars) in June.

“This is due to new borrowings by the FGN to part-finance the deficit in the 2022 Appropriation (Repeal and Enactment) Act, as well as new borrowings by state governments and the FCT,”

the DMO said.

DEBT SERVICE TO REVENUE STILL HIGH

 The total public Debt-to-GDP ratio remained within limits, at 23.06 per cent, while Debt-Service-to-Revenue was still high.

It stated further that the federal government was committed to increasing revenue in order to reduce the amount that went into debt servicing.

“The Debt-to-GDP as at June 30, was 23.06 per cent compared to the ratio of 23.27 as at March 30. It remains within Nigeria’s self-imposed limit of 40 per cent.

“While the Federal Government continues to implement revenue-generating initiatives in the non-oil sector and block leakages in the oil sector, Debt Service-to-Revenue ratio remains high,” it said.