HOW FG’S DEBT PROFILE SURGED 658% TO #26.9trn IN 21 YEARS

Nigeria’s public debt has been on the rise. Despite securing debt relief during the Olusegun Obasanjo-led administration, successive governments have continued on a borrowing spree — the federal government’s component of the public debt surging 658 percent to N26.9 trillion in the last 21 years.Advertisement

Federal Government External loans rise 366% since 2015. Nigeria’s external loan stock is set to hit an all time high of $45 billion, following President Muhammadu Buhari’s request for fresh external borrowing to the tune of $4.054 billion from the Senate yesterday.

The proposed addition to the debt stock indicates that external borrowings have skyrocketed the nation’s foreign debt portfolio by 366 per cent since 2015 when the total outstanding foreign debt was $9.7 billion.
This comes against a huge decline in actual revenue over a six year period with 2020 recording N3.4 trillion, about 37 per cent decline against N5.43 trillion recorded in 2015. Also, approval of the new request will bring the total approved foreign borrowings in 2021 alone to $12.3 billion.Buhari in the letter dated August 24, 2021 and read during plenary yesterday by President of the Senate, Senator Ahmad Lawan, is asking for external borrowing of $4.054bn, €710m, $125m in addendum to the 2018-2020 borrowing plan.

The letter explained that the projects listed in the 2018-2021 Federal Government Borrowing Plan are to be financed through sovereign loans from the World Bank, French Development Agency, AFD, China Exim-Bank, International Fund for Agricultural Development, IFAD, Credit Suisse Group and Standard Chatered/China Export and Credit (SINOSURE) in the total sum of USD4,054,476,863.00; Euro 710,000,000.00 and Grant Component of USD125,000,000.00. “However, in view of other emerging needs and to ensure that all critical projects approved by FEC as at June 2021 are incorporated, I hereby forward and addendum to the proposed Borrowing Plan.
In a statement signed by the spokesman, Kola Ologbondiyan, the party lamented that with the N33.107 trillion debt already accumulated by President Buhari and the APC “with nothing to show but decayed infrastructure and a depressed economy, an addition N5.62 trillion borrowing proposed by Buhari for the 2022 budget and now a fresh N2.66 trillion external loan, the APC will be hanging over N40 trillion debt on the nation, with no clear-cut repayment plan.”