The total debt stocks of the Federal Government of Nigeria, the 36 state governments and the Federal Capital Territory increased by N3.28 trillion in the first six months of this year.
According to the Debt Management Office (DMO), the total debt stock, which is a combination of domestic and external debt, rose from N39.56 trillion at the end of last year to N42.84 trillion at the close of the second quarter 2022.
Breakdown of the total debt stock showed external debt accounted for N16.61 trillion as at June 30, with the domestic debt contribution N26.23 trillion during the same period.
The Debt Management Office explained that more than half of the external debt are concessional and semi-concessional loans. It further disclosed that domestic debt had risen due to the loans borrowed to finance the FG budget deficit, coupled with state governments and the FCT obtaining new loans.
“Over 58 percent of the external debt stock are concessional and semi-concessional loans from multilateral lenders such as the World Bank, International Monetary Fund, Afrexim and African Development Bank and bilateral lenders including Germany, China, Japan, India and France.” DMO said.
While the total public debt to Gross Domestic Product (GDP) is 23.06 percent, below the self-imposed limit of 40 percent, and also down from the ratio of 23.27 percent of March 30, 2022, the Debt Management Office said the debt is negatively affecting the revenue of the government.
“While the FGN continues to implement revenue-generating initiatives in the non-oil sector and block leakages in the oil sector, debt service-to-revenue ratio remains high.” the DMO stated.