Nigeria’s public debt rises by N485 billion in six months

04 Feb 2016
Financial Nigeria


An analysis by Financial Nigeria of the country's debt stock shows that between January last year and June 30, the government increased its debt by N825 billion.

Nigeria's Minister of Finance, Kemi Adeosun

Nigeria's Debt Management Office (DMO) said on Wednesday that the country's total debt as of December 31, 2015 was N12.6 trillion ($65.4 billion). The current debt profile represents 11.5 per cent of Nigeria's GDP of $569 billion (2014).   

Nigeria's public debt rose by N1.3 trillion from N11.24 trillion recorded on December 31, 2014, to the latest figure. An analysis by Financial Nigeria of the country's debt stock shows that between January last year and June 30, the government increased its debt profile by N825 billion. Also during this period, the country's foreign reserves dropped from $34.5 billion reported on January 5 to $29 billion at the end of June. Crude oil prices averaged $53 per barrel in the first half of last year.

In the second half of the year, when oil prices averaged $42 per barrel, the government borrowed N484.9 ($2.5 billion). Nigeria's foreign reserves as of December 31 was $29.1 billion, according to data provided by the Central Bank of Nigeria.

According to the DMO, Nigeria's external debt stock stood at N2.11 trillion ($10.7 billion) as of December 31, 2015, while the domestic debt stock of the federal government and states was N10.6 trillion ($54.7 billion). The federal government's component of the domestic debt stock was N8.8 trillion ($44.9 billion).  

The government plans to finance part of the 2016 proposed budget of N6.08 trillion ($30.71 billion) through domestic and foreign borrowings. The proposed budget for 2016 has a deficit of N2.22 trillion ($11.21 billion), which is equivalent to 2.16% of GDP and will take the country's overall debt profile to 14% of GDP. Foreign reserves are currently down to $28 billion.

The Financial Times reported this week that about $3.5 billion in loans are under discussion with the World Bank and the African Development Bank to help fund the 2016 budget deficit.

Earlier in the week, Nigeria’s Finance Minister, Kemi Adeosun, said negotiations with both international lenders were ongoing. She said, “As far as possible, our foreign borrowing will be tied to specific capital projects. A number of these projects are revenue-generating which will be used to fund the loan repayments.”

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