Nigerian Government Spends N41.9 Billion on Debt Servicing in January Alone

• Nigeria's debt servicing is increasing by the time as the country spent about N41.9 billion servicing debts in January alone
• The Central Bank of Nigeria says there is a 45 per cent leap month-on-month on debt servicing in the country
• A group, the Centre for the Promotion of Private Enterprise had stated that Nigeria’s debt, could hit N50 trillion soon

Nigeria’s monthly debt servicing increased by $31.46 million in one month to $101.29 million in January, according to figures released by the Central Bank of Nigeria (CBN)

The Punch report shows a 45 per cent jump month-on-month.

The CBN said in its data on debt service repayment that the federal government spent about $69.83 on debt service repayment in December.

DMO opens can of debts

The data revealed that $148.57 million and $85.23 million were spent on debt service repayment in November and October respectively.

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According to the Debt Management Office (DMO), Nigeria’s outstanding debt stood at N39.57 trillion or N95.78 billion as of December 2021.

The DMO stated that the total external debt consumed about 40.08 per cent, making N15,86 trillion ($38.39 billion) in the period being reviewed.

The total public debt stock increased from N27.4 trillion ($80.5 billion) by the end of December 2019 to N32.92 trillion ($86.4 billion) as of the end of 2021.

Group raises alarm, advocates solution

According to a Punch report, the Centre for the Promotion of Private Enterprise had stated that Nigeria’s debt, including that of the Asset Management Corporation of Nigeria (AMCON) and borrowings from the Central Bank of Nigeria, could hit N50tn within the shortest possible time.

The body said this as they unveiled the 2022 first-quarter economic review of CPPE.

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CPPE backed concessionary financing for the country, as opposed to commercial debts which are expensive.

FG spends 96% revenue on debt servicing in 2021, worst record ever

Recall that Legit.ng has reported that Nigeria The Nigerian government spent the sum of N4.22 trillion on debt servicing in 2021 alone, which is an increase of 29.3 per cent in comparison to N3.27 trillion spent the year before. The revenue for the same period increased slightly by 9.3 per cent to N4.39 trillion. According to Nairametrics, it means that Nigeria spent about 96 per cent of its total revenue on servicing debt obligations in the year under review.

In comparison to the year before, the country’s debt service-t0-service ratio went up from 81.1 per cent in 2021 to 96 per cent in the year under a year.

The country’s revenue has been bugged by a lack of performance of oil revenue because of the incessant decline in production capacity and the volatile nature of crude oil. Data from the National Bureau of Statistics (NBS) says the country’s daily crude oil production dropped to 1.6mbpd in 2021 from 7.8mbpd recorded the year before.

Source: Legit.ng