Nigeria’s Debt Hits N22.43 Trillion, Domestic Component 70.51%
Data obtained from the Debt Management Office (DMO) have shown Nigeria’s total debt now stands at N22.43 trillion.
According to the DMO, the nation’s total debt as of September 30, 2018, stood at N22.43 trillion. As of June 30, 2015, the country’s total debt stood at N12.12 trillion. This means that within the tenure of the present administration which came to power on May 29, 2015, the country’s total debt has risen by N10.31 trillion or 85.06 per cent.
Of the total debt, the external component of both the Federal Government and state governments’ debts including that of the Federal Capital Territory stood at $21.59 billion.
As of June 30, 2015, the external debt component of the country’s total debt stood at $10.32 billion. This means that the external debt component rose by $11.27 billion or 109.21 per cent. On the other hand, the domestic debt of both the Nigerian Government and the sub-national governments stood at N15.81 trillion.
Analysing the debt statistics further showed that the domestic debt of the Nigerian Government alone stood at N12.29 trillion as of September 30, 2018.
The domestic debt of the Nigerian Government as of June 30, 2015, stood at N8.4 billion while that of the states and FCT stood at N1.69 trillion.
The DMO added that the debt statistics as of September 30, 2018, was only slightly different from the statistics as of June 30, 2018.
On the difference between the debt statistics of the two quarters, the DMO said, “External debt declined by 2.02 per cent to $21.59 billion due largely to the redemption by Nigeria of a $500 million Eurobond which matured on July 12, 2018.
“The Eurobond which was issued for a tenor of five years in 2013 was the first Eurobond maturity for Nigeria and Nigeria’s ability to repay it seamlessly boosted Nigeria’s position as a good credit in the International Capital Market.
“The domestic debt of the FGN, states and the FCT grew by 1.19 per cent from N15.63 trillion in June 2018 to N15.8 trillion in September 2018. This increase of N185 billion was attributed to the FGN (N135 billion) and states and FCT (N50 billion).”
It added, “The combination of an increase in the level of domestic debt and a decrease in the external debt stock resulted in a slight shift in the portfolio composition.
“As of September 30, 2018, the share of domestic debt was 70.51 per cent compared to 69.83 per cent in June 2018.
“This trend is expected to be reversed in Quarter Four 2018 as the new external borrowing of N849 billion (about $2.78 billion) provided in the 2018 Appropriation Act is expected to be raised within the quarter.”
The current strategy of the Nigerian Government is to raise external debt component to 40 per cent and to raise the local debt component to 60 per cent in order to take advantage of the lower interest rate on foreign debts.