IMF loans, others push Nigeria’s debts to N31trn – DMO
Nigeria’s total debt stock has risen to N31 trillion as of June 2020, rising from N28.6tn reported in March, the Debt Management Office, DMO has said.
According to the periodic data which it released on Wednesday, DMO said the public debt stock consist of those for the Federal Government, the 36 state governments and the
Federal Capital Territory (FCT). The N31.009tn debt is about $85.897 billion while that of March which was N28.628tn was about N79.303bn, growing by N2.38tn or $6.59bn was due to the $3.36bn Budget Support Loan from the International Monetary Fund, New Domestic Borrowing to finance the Revised 2020 Appropriation Act, the issuance of the N162.557bn Sukuk, and Promissory Notes issued to settle Claims of Exporters.
A breakdown of the data shows that the multilateral debts are the highest of the stock of N16.360tn accounting for 51.97% of the total stock. The 10 agencies include IMF, World Bank Group, the African Development Bank (AfDB) Group, among others.
The bilateral debts account for N3.948tn representing 12. 54% of the debt stock taken from the international development agencies of China, France, Japan, India and Germany.
The third debt category is the commercial debt which is N11.168tn and represents 35.48% of the debt. This is the second largest debt after those of the multilateral agencies with Eurobonds and Diaspora bonds accounting for them.
The DMO expects the Public Debt Stock to grow as the balance of the new domestic borrowing is raised and expected disbursements are made by the World Bank,
African Development Bank and the Islamic Development Bank which were arranged to finance the 2020 Budget.
Recall that the 2020 Appropriation Act had to be revised in the face of the adverse and severe impact of COVID-19 on Government’s Revenues and increased expenditure needs on health and economic stimulus amongst others.
It said additional Promissory Notes are expected to be issued in the course of the year, and new borrowings by State Governments are also expected to increase the Public Debt Stock.
Economist and Chief Executive Officer - BIC Consultancy Services, Dr Boniface Chizea said: “I think our situation is precarious and we all know that but we are physically challenged because we are borrowing to maintain services.”
He said borrowing is inevitable at the moment and the citizens should be grateful as a country because it can still borrow, noting that other nations have the same need but cannot find lenders.
“We hope that once the world economy begins to peak, we will see an increase in demand for oil and oil prices may also pick up and that would bring in more revenue to enable us service these debts and build critical infrastructure.”