Nigerian Govt spends $15.55bn on debt servicing between 2019 and 2024 — CBN

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A recent report from the Central Bank of Nigeria (CBN) has revealed that the Federal Government of Nigeria has spent a staggering $15.55 billion on debt servicing between 2019 and 2024. This amount represents a significant increase in debt servicing payments, with a 270.9% rise compared to the first five months of 2019.

Breakdown of Debt Servicing Payments

• 2019: $588.33 million (January to May)
• 2020: $5.40 billion
• 2021: $2.02 billion
• 2022: $2.34 billion
• 2023: $3.43 billion
• 2024: $2.18 billion (January to May)

The CBN data indicates that the highest amount spent on debt financing was in 2020, totaling $5.40 billion. Furthermore, Nigeria’s external debt service payments increased significantly by $1.1 billion, reaching $3.5 billion in 2023.

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Implications and Projections

The significant increase in debt servicing payments has raised concerns about Nigeria’s debt sustainability. Fitch Ratings predicts that the country’s external debt servicing will escalate by $400 million to $5.2 billion next year. This is despite the government’s assertions that it is shifting its focus towards domestic borrowing.

The Federal Government plans to take on additional external debt, including N1.8 trillion in commercial borrowing and N1.1 trillion in concessional loans, as outlined in the 2024 budget. This move is expected to further increase external debt service payments, mirroring Fitch Ratings’ predictions.

Recently, the government received $2.25 billion from the World Bank to support President Bola Tinubu’s economic reforms. The loan is expected to support the government’s economic reforms and development initiatives, with a focus on raising non-oil revenues and safeguarding oil and gas revenues.

In conclusion, the Federal Government of Nigeria’s significant spending on debt servicing, as revealed by the CBN report, raises concerns about the country’s debt sustainability. As the government plans to take on additional external debt, it is essential to carefully consider the implications of this move on the nation’s economy.

Tags: CBN, Central Bank of Nigeria, President Bola Tinubu, Nigeria, Fitch Ratings, World Bank, Debt, Federal Government.