Nigeria’s Debt May Hit N77trn By May 2023, Says DMO

The Director-General of the Debt Management Office (DMO), Ms Patience Oniha, has revealed that the country’s total debt stock may hit N77 trillion by the end of President Muhammadu Buhari’s administration on May 29, 2023 as the country continues to grapple with increasing debt burden. 

This, she explained would come to fruition if the current Central Bank of Nigeria (CBN) Ways & Means, which has been accumulated from 2014 to 2022, and put at about N22.7 trillion is securitized, coupled with the N44.06 trillion total debt stock as at third quarter of 2022 (Q3 2022) and the N8 trillion new borrowings.

She added that securitization was the best option because at the current interest rate charge of 18.5 percent, additional N1.8 trillion to N2 trillion may be incurred as interest if the government fails to securitize the CBN Ways & Means; hence the decision of the executive to work with the National Assembly to bring it into fruition.

Nigeria’s public debt rose to N44.06 trillion in the third quarter of 2022 as it continues with repayment burden.

The Director General stated this in Abuja yesterday during the public presentation and breakdown of the highlights of the 2023 Appropriation Act.

She said, “The DMO released the figure for the country’s debt stock as at September, you don’t expect it to be significantly different from December.

“Secondly, there are a lot of discussions on the CBN’s Ways & Means.

“In addition to the significant cost savings in loans service we would get by securitizing it, there is an element of transparency in the sense that it is now reflected in the public debt stock.

Once it is passed by the National Assembly, it means we will be seeing that figure included in the public debt.

“You will see a significant increase in public debt to N77 trillion. So, if you add the new borrowing depending on market conditions N5 trillion. So we’re looking anywhere at, it will be about N72 trillion.

“The other debt stock we are trying to highlight is to say the debt stock is also growing from the issuance of promis- sory notes which are not true borrowing as such by the government. It will be safe to say that we will be looking at N70 trillion.

“While the debt is growing because there is new borrowing, revenue is receiving significant importance. Like the DMO always says, you can’t talk about debt without talking about revenue. We need the two to work together”.