The
Nigerian government borrowed N4.365 trillion in 2017, bringing the country’s
total debt stock to N21.725 trillion.
The Debt
Management Office (DMO) made the disclosure during a press conference in Abuja
yesterday.
The new
debt stock represents 18.20 per cent of Nigeria’s Gross Domestic Product (GDP)
for 2017. This indicates that the debt is sustainable and within the 56 per
cent threshold for countries in Nigeria’s peer group, said DMO Director General
Patience Oniha.
She noted
that the debt consisted of N15.938 trillion domestic borrowings for the Federal
Government, the 36 states and the Federal Capital Territory (FCT). This
represents 73.36 per cent of the entire debt stock, with the external component
consisting of a balance of N5.787 trillion, representing 26.64 per cent.
A further
breakdown indicates the domestic debt for the Federal Government was N12.589
trillion, while that of states and the FCT was N3.348 trillion.
On debt
servicing, Oniha revealed that N1.617 trillion was expended: N1.476 trillion
for domestic debt and N141.72 billion for external debt, representing 91 per
cent and nine per cent.
The
Federal Government’s portion of the new borrowings was invested in
infrastructure delivery, as captured in the 2016 and part of the 2017 capital
votes financing, which greatly contributed to the county’s recovery from
recession, she said.
The
composition of the debt stock as at the end of 2017 showed that external debt
was 26.64 per cent of the portfolio, up from 20.04 per cent in 2016, while
domestic debt was 73.36 per cent, down from 79.96 per cent in 2016.
The key
benefits of the restructuring of the portfolio are reduction of the
government’s debt service costs, lowering of interest rates in the domestic
market, and improved availability of credit facilities to the private sector.
“The DMO
repaid N198 billion Nigerian Treasury Bills (NTB) in December 2017 with the
proceeds of Eurobond issuances. And the DMO has continued further implementation
of the strategy in 2018 with the issuance of USD2.5 billion Eurobonds in
February 2018, the proceeds of which is being used to repay maturing domestic
debt, starting with N130 billion NTBs repaid on March 1, 2018.”
She
added: “The borrowings were for financing capital expenditure and stimulating
the economy. The funds injected through the borrowings strongly supported the
implementation of the Federal Government’s budget, which helped the country to
exit recession in 2017.”
Source: Guardian
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