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Nigeria’s debt hits N31tr

…Lagos leads other states with N493.318b

Emeka Okoroanyanwu

Nigeria’s total public debt stock rose from N28.628 trillion ($79.303 billion) as at March 31, 2020 to N31.009 trillion ($85.897 billion) by June 30, 2020, the latest data released by the Debt Management Office (DMO) has shown.

This comprises debt owed by the federal, sub-national governments (states) and the Federal Capital Territory (FCT).

The DMO attributed the N2.381 trillion ($6.593 billion) increase in the debt stock to the $3.36 billion budget support loan from the International Monetary Fund (IMF), new domestic borrowing to finance the Revised 2020 Appropriation Act (including the issuance of N162.557 billion Sukuk), as well as Promissory Notes issued to settle claims by exporters.

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The agency explained: “The data shows that in naira terms, the total public debt stock, which comprises the debt stock of the federal government, the 36 state governments and the Federal Capital Territory stood at N31.009 trillion or $85.897 Billion. The corresponding figures for March 31, 2020, were N28.628 trillion or $79.303 billion.

“The increase in the debt stock by N2.381 trillion or $6.593 billion was accounted for by the $3.36 billion Budget Support Loan from the International Monetary Fund, New Domestic Borrowing to finance the Revised 2020 Appropriation Act, including the issuance of the N162.557 Billion Sukuk, and Promissory Notes issued to settle claims of exporters.”

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A breakdown shows that the federal government’s domestic debt stock as of June 30, 2020 stood at N15.445 trillion (N15,455,699,131,531.00). This comprises debts arising from Nigerian Treasury Bills, Nigerian Treasury Bonds, FGN Savings Bond, FGN Sukuk, Green Bond, and Promissory Notes

The 36 states of the federation and the FCT also accounted for a domestic debt of N4.189 trillion (N4,189,699,078,909.01) during the period under review.

Foreign debt component as at June 30, 2020, was $31.477 billion while domestic debt accounted for $54.419 billion of the total public debt of $85.897 billion (in dollar terms).

The DMO explained that it 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.

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“It will be recalled 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.

“Additional Promissory Notes are expected to be issued in the course of the year, this, and new borrowings by State governments are also expected to increase the public debt stock,” the agency added.

Meanwhile, the latest debt statistics show that Lagos State with a total domestic debt of N493. 318 billion is the most indebted state in the country, followed by Rivers with N266.936 billion (N266,936,225,79) Akwa Ibom and Delta with N239. 209 billion (N239, 209,746,919.94) and N235,860 billion (N235,860,479,518.82) respectively