Borrowings, Loan Swap to Push Nigeria’s Debt to N77trn
Patience Oniha, DMO Chief

Borrowings, Loan Swap to Push Nigeria’s Debt to N77trn

Nigeria’s total public debt could rise to N77 trillion in 2023 following a request for approval for a loan-to-bond swap and new borrowings to fund the 2023 budget, according to the Debt Management Office -DMO.

As of the third quarter of 2022, total public debt crossed N44 trillion, though Debt office believes that the debt to gross domestic product is still within fiscal responsibility act.

Nigeria President, Muhammadu Buhari is seeking approval from the lawmakers to restructure the Ways and Means Advances obtained from the Central Bank of Nigeria during his tenure ahead of his exit in May, 2023.

As lender of last resort, the Central Bank of Nigeria provides back door finances to close the shortfalls in the government’s budget. While this is allowable, Godwin Emefiele led apex bank breached the  provision in the 2007 CBN Act.

Last year, Nigeria suffered from its worse fiscal performance amidst oil theft and lower production volume that saw Angola overtaken the Africa’s most populous nation as highest crude oil exporter.

Despite all efforts geared toward diversifying Nigeria’s income, export receipt still account for the largest chunk of government revenue. Though, non-oil exports is popping but the weight has remained insignificant due to over concentration on hydrocarbon revenue.

“If that is approved sometime this year …, it means you will be seeing that figure included in the public debt,” Patience Oniha, director general at the DM  said on Wednesday. >>Nigeria Sees Sharp Rise in Prices as FX Adds to Cost Pressures -PMI

Speaking to the development, Finance Minister Zainab Ahmed said total public debt would rise to 35.3% of GDP from 22.97% with the loan conversion. The conversion and new borrowings would take domestic debt to 70% of total public debt in 2023, from 61.1% currently, Ahmed said.

Previous articleFG to Spend N3.4trn on Petrol Subsidy in Next 6-Month
Next articleNaira Depreciates at Investors, Exporters FX Window