In a publication on Friday (today), the Debt Management Office (DMO) confirmed that Nigeria’s debt profile has now risen to $108.3bn (N49.8trn).
The total public debt stock comprises the external and domestic debts of the Federal Government of Nigeria, OsunDailyNG understands.
DMO, an agency of the government established to coordinate the management of Nigeria’s debt centrally, revealed in the publication on Friday night that the figure, which includes money owed by the federal and state governments, does not include the federal government’s N22.7tr Ways and Means Advances of the Central Bank of Nigeria (CBN).
“As at March 31, 2023, the Total Public Debt Stock comprising the external and domestic debts of the Federal Government of Nigeria (FGN), the thirty-six (36) States, and the Federal Capital Territory (FCT) was N49.85tr ($108.30bn).
“Comparatively, the Total Public Debt Stock for the preceding period, December 31, 2022, stood at N46.2tr ($103.3bn). During the period, there were increases in the debt stock of the FGN, States, and the FCT.”
“The Public Debt Stock for March 2023 does not include the FGN’s N22.719 Trillion Ways and Means Advances of the Central Bank of Nigeria whose securitization was approved by the National Assembly in May 2023. The amount will be included in the FGN’s Domestic Debt Stock from June 2023,” the statement reads.
Meanwhile, the Debt Management Office (DMO) had earlier warned President Bola Ahmed Tinubu-led administration against additional borrowing.
OsunDailyNG reports that the DMO gave the warning on Thursday following an analysis of the nation’s debt profile in 2022.
The DMO advised the federal government to focus on increasing revenue generation, stressing that 73.5% of this year’s revenue will be used to service debt.
It asserted that attaining a sustainable Debt Service-to-Revenue ratio will require increasing revenue from N10.49 trillion projected in the 2023 budget to about N15.5 trillion.
The agency added that the government could reduce borrowing through privatization and/or the sale of government assets.
DMO’s analysis revealed that the Total Public Debt-to-GDP ratio is projected to increase to 37.1% in 2023, mainly due to new borrowings, FGN Ways and Means at the CBN, and estimated Promissory Notes issuance.
While the baseline scenario indicates that the debt stock remains sustainable, the borrowing space has been reduced compared to the self-imposed debt limit of 40%.
The projected FGN Debt Service-to-Revenue ratio of 73.5% for 2023 exceeds the recommended threshold of 50% due to low revenue. This highlights the urgent need to increase government revenue significantly.
The DMO emphasized the importance of adhering to existing legislation on government borrowing, such as the Fiscal Responsibility Act 2007 and the Central Bank of Nigeria Act 2007, to moderate the growth rate of public debt.
Furthermore, the DMO called for a focus on revenue mobilization initiatives and reforms to increase the country’s tax revenue to GDP ratio.
