Nigeria’s total public debt grew by 2.1 per cent or N693bn in the fourth quarter of last year to N32.92trn on Dec. 31, according to the Debt Management Office.
As at September 30, 2020, the country’s total public debt stood at N32.22trn.
A statement by the debt office on Monday noted that the figures include the debt stock of the federal and state governments as well as the Federal Capital Territory.
It said following the country’s exit from recession in 2017, the level of new borrowing at the federal level had been declining as part of the government’s measures to moderate the rate of growth in the public debt stock in order to ensure debt sustainability.
The DMO said new borrowing to part-finance budget deficits had declined steadily from N2.36trn in 2017 to N2.01trn in 2018, N1.61trn in 2019 and N1.59trn in the first 2020 Appropriation Act.
“This trend was reversed in 2020 due to the economic and social impact of the COVID-19 pandemic as new borrowing in the revised 2020 Appropriation Act was N4.20trn. Many countries including the advanced countries also increased their level of borrowing as a result of COVID-19,” it said.
The debt office noted that apart from the new domestic borrowing of N2.3trn, the other new borrowings were concessional loans from the International Monetary Fund ($3.34bn) and other multilateral and bilateral lenders.
It said, “This incremental borrowing to part-finance the 2020 Budget and the additional issuance of promissory notes to settle some arrears of the Federal Government of Nigeria, contributed to the increase in public debt stock. New domestic borrowings by state governments also contributed to the growth in the public debt stock.
“Total public debt to Gross Domestic Product as at December 31, 2020 was 21.61 per cent which is within Nigeria’s new limit of 40 per cent.”
The DMO said the various initiatives of government to increase revenues such as the Strategic Revenue Growth Initiative and the Finance Act, 2020, should help shore up government’s revenue and reduce the debt service to revenue ratio.
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