Nigeria’s Public Debt Soars by 75%, Reaches N87 Trillion in Three Months

Nigeria’s Public Debt Soars by 75%, Reaches N87 Trillion in Three Months

Debt Management Office Releases Alarming Figures

Lagos, Nigeria – The Debt Management Office (DMO) has released staggering figures revealing that Nigeria’s total public debt surged to N87.38 trillion by the close of the second quarter of 2023.

This represents a monumental increase of 75.29%, or N37.53 trillion, in comparison to the N49.85 trillion recorded at the end of March 2023. The DMO report underscored that this debt encompasses the N22.71 trillion “Ways and Means Advances” extended by the Central Bank of Nigeria to the Federal Government.

The DMO report stated, “Nigeria’s total public debt stock as at June 30, 2023, was N87.38 trillion ($113.42 billion). It comprises the total domestic and external debts of the Federal Government of Nigeria, the thirty-six states, and the Federal Capital Territory.”

It further outlined that the major contributor to this surge was the inclusion of the N22.712 trillion securitized FGN’s Ways and Means Advances. The report also highlighted additional contributions to the debt stock arising from fresh borrowings by both the Federal Government and sub-national entities, drawn from local and foreign sources.

The report also noted, “The reforms already introduced by the present administration and those that may emerge from the recommendations of the Fiscal Reform and Tax Policies Committee, are expected to impact debt strategy and improve debt sustainability.”

Earlier, the DMO had projected a potential public debt burden of N77 trillion, anticipating the National Assembly’s approval of the former President Muhammadu Buhari’s proposal to restructure the Central Bank of Nigeria’s Ways and Means Advances. This facility serves as a funding mechanism through which the CBN addresses budget shortfalls.

Patience Oniha, the Director-General of the DMO, highlighted during a public presentation of the 2023 budget that the debt would have amounted to N70 trillion without the additional N5 trillion in new borrowing and N2 trillion in promissory notes.

However, current data shows that the present debt stock of N87.38 trillion exceeds the DMO’s earlier projection by N10.38 trillion.

An in-depth analysis of the report revealed that Nigeria carries a total domestic debt of N54.13 trillion and an external debt of N33.25 trillion. Domestic debt accounts for 61.95% of the total, while external debt makes up 38.05%.

Comparatively, Nigeria’s domestic debt rose by a staggering 79.18% from N30.21 trillion, while external debt saw a notable increase of 69.28% from N19.64 trillion in the first quarter of 2023. These figures underscore the urgency for a strategic approach to manage and mitigate Nigeria’s burgeoning debt crisis.