Report: Nigeria Indebted to China than Any Other Country
Esther Oluku with agency report
Chinese credit accounts for 80 per cent of all bilateral loans to Nigeria, according to data from the Debt Management Office (DMO).
China provides loans to build railways, power plants and airports, helping to bridge a huge infrastructure gap in Africa’s largest oil producer, a report by Bloomberg said yesterday.
However, lending from China makes up only three per cent of Nigeria’s total debt stock of $81 billion.
In terms of bilateral debt, the DMO put Nigeria’s total debt to China as at March 2019, at $2.554 billion. The country’s debt to France stood at $366.07 million; Japan - $74.63 million; India - $26.46 million, and Germany - $171.79 million.
The country’s total bilateral debt stood at $3.192 billion.
Nigeria’s total public debt, comprising the federal government, states and the Federal Capital Territory (FCT) debt stocks stood at N24.947 trillion or $ 81.274 billion as at March 31, 2019, according to data from the DMO. The figures indicated that the external debt also increased by N101.646 billion in three months.
The 2.3 per cent rise contrasts with the figure of N24.387 trillion ($ 79.437 billion) posted as at December 31, 2018.
According to the DMO, the increase of N560.009 billion in the total public debt in Q1 2019 was due to a growth in domestic debt stock by N458.363 billion.
It added that increases were recorded in the domestic debt stock of the federal government, states and the FCT.
The N24.947 trillion ($ 81.274 billion) for the period composed of a total external debt component of $25,609.63 billion, which is 31.51 per cent of the total debt stock owed by the federal government, states and the FCT.
Total domestic debt also stood at $55,664.46 billion, representing 68.49 per cent. The federal government solely accounted for $42,721.68 billion or 52.56 per cent, while $12,942.77 billion (over N3.972 trillion) or 15.92 per cent of the domestic debt stock stood against the states and the FCT.
The over N12 trillion spike in borrowing since 2015 has been attributed to the quest to reflate the economy.
After exiting a crushing debt trap in 2005 under the Paris Club of creditors, at no other time has the country faced a debilitating debt burden as the present situation.
China recently advised Nigeria to, as a matter of priority, open a sinking fund and an escrow account to engage her to seamlessly repay the loans, which it borrowed from the Asian country for the construction of rail projects, particularly the Abuja-Kaduna rail.