According to the latest domestic debt figures given by the Debt Management Office (DMO), Nigeria’s entire public debt has hit an all-time high of N44.06 trillion, up from N42 trillion in the second quarter of the year.
At the end of the third quarter of 2022, the nation’s debt profile is primarily driven by domestic borrowing (which accounts for more than 61% of total debt) and external debt (which accounts for more than 38% of total debt). Debt servicing expenditures jumped by 23% to N3.04 trillion, according to the data.
Borrowing from the federal government accounts for 49% of local borrowing, while state government debt accounts for more than 12% of this risk. The figure excludes the Nigerian government’s borrowing of more than N20 trillion from the central bank.
Currently, the FG has raised more over #20 trillion through the Central Bank’s Ways and Means window. Recently, the finance minister hinted at a government plan to securitize the money through the local debt capital market.
Details concerning the idea are now hazy as the market awaits the government’s final decision. Analysts believe that the amount of overdrafts raised by FG through the ways and means window violates the CBN Act.
Fitch Ratings recently lowered Nigeria’s government rating, citing debt issues as well as the fact that interest payments continue to outpace income collection.
Furthermore, the local currency has continued to lose value as a result of poor export earnings and rising import expenses. When completely secured, Nigeria’s real debt load may be near 70 trillion.