Public Debt Will increase by N57trn in 18 Months
Nigeria’s complete public debt rose by N57.3tn throughout the first 18 months of the present administration, in line with an evaluation of knowledge launched by the Debt Administration Workplace.
The rise represents a 65.6 per cent surge within the debt inventory, rising from N87.38tn recorded on the finish of June 2023 to N144.67tn as of December 2024.
President Bola Tinubu, who assumed workplace on Could 29, 2023, inherited a debt portfolio that already mirrored heavy home obligations, together with a N22.7tn Methods and Means steadiness from the Central Financial institution of Nigeria. Nevertheless, inside a 12 months and a half, Nigeria’s borrowing profile expanded sharply, pushed by elevated native money owed and a steep depreciation of the naira.
On the finish of June 2023, the DMO reported that Nigeria’s complete exterior debt stood at N33.25tn, whereas home debt was N54.13tn. By December 2024, exterior debt had jumped to N70.29tn, whereas home debt climbed to N74.38tn.
The rise in exterior obligations, each in absolute and proportional phrases, marks a shift within the composition of Nigeria’s debt, with overseas debt now accounting for practically half of the nation’s complete debt inventory.
In greenback phrases, nonetheless, the debt image appears completely different. The whole public debt declined from $113.42bn in June 2023 to $94.23bn by December 2024, reflecting a nominal lower of 17 per cent.
Learn Additionally:
However this discount shouldn’t be attributable to decrease borrowings. It stems from the sharp depreciation of the naira, which fell from an official alternate price of N770.38 to $1 in June 2023 to about N1,535 to $1 by the tip of 2024.
The alternate price motion considerably impacted the naira valuation of Nigeria’s dollar-denominated money owed. Though the greenback quantity of overseas borrowings remained comparatively steady, the naira worth practically doubled.
The Federal Authorities’s exterior debt, for example, rose from N29.9tn in June 2023 to N62.92tn by December 2024, whereas that of the states and the Federal Capital Territory elevated from N3.35tn to N7.37tn over the identical interval.
There was additionally a notable discount within the home debt of sub-national governments. States and the FCT owed N5.82tn in home debt as of June 2023, which fell to N3.97tn by December 2024. This drop could mirror a decline of their entry to extra debt as borrowing prices surge.
On the federal degree, the overall debt obligation — combining home and overseas borrowings — climbed from N78.21tn to N133.33tn, indicating that the Federal Authorities stays chargeable for over 90 per cent of the nation’s complete debt.
The rising weight of exterior debt has additionally altered the structural steadiness of Nigeria’s debt portfolio. In June 2023, exterior debt accounted for 38 per cent of the overall. By December 2024, that determine had risen to just about 49 per cent.
