- With Naira depreciating the external debts of Nigeria including 36 states are becoming very expensive to service
- As at December 2021, the external debts of 36 states alone stood at $4.77 billion, a significant increase from where it was in the previous years
- Five states alone account for a large chunk of the total debt, which is led by Lagos State
With Naira going through a rough patch against the US dollar, servicing the external debts of 36 states in Nigeria has become more expensive.
At an exchange rate of N409.6/$ in December 2021, the Naira equivalent of the external debt was at N1.9 trillion.
With exchange rate at N428.12 to a dollar as at Thursday 4 August 2022, the external debt burden of states stands at N2.4 trillion the Naira equivalent.
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States with the highest level of external debt
As of December 2021, the states with the highest external debts were Lagos, Kaduna, Cross River, Edo, and Rivers.
Lagos State, Nigeria’s commercial hub, had the most external debt as of December last year.
The state owed $1.33 billion in December 2021, down from $1.40 billion in December 2020, according to data from the Debt Management Office. Its external debt rose to $1.47 billion in December 2017 from $1.21 billion in December 2015.
Kaduna State had the second highest external debt as of December 2021. Its foreign debt rose to $567.48 million at the end of last year from $554.78 million in December 2020 and $222.88 million in December 2016.
Cross River State had an external debt of $279.7 million in December 2021.
Its external debt had dropped to $192.5 million in December 2020 from $209 million in December 2019. It stood at $115 million in December 2016.
Edo State trimmed its external debt to $276.3 million in December 2021 from $280.3 million in the previous year. Its foreign debt stood at $168.2 million in December 2015.
River State saw its external debt jump to $147.8 million in December 2021 from $96.7 million in December 2020.
The state’s external debt stood at $46.9 million in December 2015.
Nigerian Government Spends N41.9 billion on debt servicing
Legit.ng reported that 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.