Nigeria's debt hits N32.9tr

Nigeria’s total public debt has risen to N32.9 trillion as at December 31, 2020.

The Debt Management Office, (DMO), which made the disclosure in a statement on Monday noted that the debt stock grew by N700 billion within three months from N32.2 trillion as at the end of September 2020, to N32.9 trillion last December.

The DMO added that the total public debt to the Gross Domestic Product was 21.61 per cent, adding that it was within Nigeria’s new limit of 40 per cent.

After Nigeria exited recession in 2017, the level of new borrowing at the Federal Level as shown in the Annual Appropriation Acts, had been declining as part of the government’s measures to moderate the rate of growth in the public debt stock in order to ensure debt sustainability. New borrowing to part finance budget deficits had declined steadily from N2.36 trillion in 2017 to: N2.01 trillion in 2018, N1.61 trillion in 2019 and N1.59 trillion in the first 2020 Appropriation Act.

However, this trend was reversed in 2020 due to the economic and social impact of the COVID-19 pestilence as new borrowing in the revised 2020 Appropriation Act was N4.2 trillion.

Many countries, advanced economies inclusive, were forced to swell their level of borrowing to cushion the impact of the COVID-19 pandemic that led to global supply chain disruption as a result of lockdowns.

The DMO stated, “It should be noted though, that apart from the new domestic borrowing of N2.3tn, the other new borrowings were concessional loans from the International Monetary Fund ($3.34bn) and other multilateral and bilateral lenders.

“This incremental borrowing to part-finance the 2020 budget and the additional issuance of promissory notes to settle some arrears of the Federal Government of Nigeria, contributed to the increase in public debt stock.

“New domestic borrowings by state governments also contributed to the growth in the public debt stock”, it stated.