Emmanuel Ochayi
The Nigerian government has restructured its debt to the Central Bank of Nigeria (CBN), resulting in a reduction of the owed amount to N4.36 trillion as of June 2023, according to data from the CBN’s quarterly statistical bulletin.
This change follows a notable increase of N3.42 trillion in just five months, raising the debt from N23.53 trillion in December 2022 to N26.95 trillion in May 2023.
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The government had paid an interest of N912.32 billion in the first quarter of 2023 on these loans, as disclosed in the Q1, 2023 Budget Implementation Report.
This figure marked a 161.47 percent increase from the previous year, and it reflects the government’s plan to allocate N1.2 trillion for servicing the loans obtained through Ways and Means Advances.
Despite this plan, the government had already spent approximately 76.03 per cent of its quarterly budget for interest payments on these advances. Ways and Means Advances serve as a vital financial tool for the CBN to support the government during temporary budget shortfalls, subject to legal limits.
In light of these changes, the Federal Government’s approach to debt management and restructuring has become a focal point in the financial landscape.
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