Daud Olatunji
In a startling revelation, Nigeria’s Debt Management Office (DMO) has reported a significant increase in the country’s public debt, which has surged by N24.33 trillion, or 24.99 percent, over a span of just three months.
PLATFORM TIMES reports that as of March 31, 2024, Nigeria’s total public debt stood at N121.67 trillion (USD91.46 billion), a stark rise from the N97.34 trillion (USD108.23 billion) recorded at the end of December 2023.
The new debt figure encompasses both domestic and external obligations of the Nigerian government, as well as the debts of the 36 state governments and the Federal Capital Territory (FCT).
Breaking down the numbers, the DMO report highlights that total domestic debt amounted to N65.65 trillion (USD46.29 billion), while total external debt stood at N56.02 trillion (USD42.12 billion).
The rapid increase in debt has raised concerns among financial analysts and policymakers about the sustainability of Nigeria’s fiscal policies.
The rise in debt levels is attributed to various factors, including increased borrowing to finance budget deficits and ongoing economic challenges.
In addition to the soaring debt figures, the government has been actively seeking new loans to manage its financial obligations.
Over the past 12 months, Nigeria has secured loans totaling $4.95 billion from the World Bank.
These loans are intended to support various developmental projects and economic reforms, but they also add to the rising costs associated with servicing external debt.
Looking ahead, the government is anticipating the approval of fresh loans amounting to $4.4 billion from both the World Bank and the African Development Bank within the coming year.
These anticipated loans are expected to provide critical funding for infrastructure projects and other key initiatives aimed at driving economic growth and development.
The escalating debt situation has sparked a debate among economists and stakeholders about the need for more prudent fiscal management and the implementation of strategies to boost revenue generation.
While borrowing can provide necessary funding for development, it also poses significant risks if not managed effectively, particularly in terms of debt servicing and repayment obligations.
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