- With the value of the Naira seriously depreciating against the dollar, external debts of Nigeria, including 36 states, are becoming very expensive to service
- 10 states led by Lagos states account for a significant chunk of the total external debts held by states
- Deby remains one of the biggest fiscal burdens of Nigeria, and more revenue is now needed to pay back
The external debt load of the 36 states and the Federal Capital Territory have significantly increased in naira terms.
This is thanks to the continued depreciation of the Nigerian currency at the official and unofficial foreign exchange markets.
Data from the Debt Management Office (DMO) showed that the total external debt stock of 36 subnational governments and the Federal Capital Territory, Abuja, stood at $4.34 billion or N1.80 trillion using the exchange rate of N414.58/$ as of June 1, 2023.
Today, September 20, 2023, the value of the external debt in naira terms has increased to N3.35 trillion at the current exchange rate of N771.27/$.
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This represents an addition of N1.55 trillion in debt due to naira depreciation in just 3 months.
It is even worse if the current black market rate of N980 a dollar is used to calculate the external debt stocks of Nigerian states.
10 States with the highest debt burden
- Lagos - $1.26 billion
- Kaduna - $569.37 million
- Edo - $258.40 million
- Cross River - $153.17 million
- Bauchi - $170.44 million
- Adamawa - $100.92 million
- Anambra - $105.58 million
- Enugu - $120.67 million
- Enugu- $111.62 million
- Ondo - $80.84 million
Changes in states' external debts in naira terms
|States||External debt in naira in June 2023||External debt in naira in September 2023|
“You Will Be Influenced”: US Cautions Tinubu About China After Debt Increased by 200% Under Buhari
In an earlier report by Legit.ng, the United States government asked Nigeria to be careful about its relationship with China.
The US, in its Integrated Country Strategies document of the Department of State, noted that China could influence the Nigerian government through the loans it provides to the country.
The warning comes after an increase in Nigeria's debt by over 237.31% during Muhammadu Buhari's tenure.