N4.17trn: How much Nigeria has borrowed in a year

Statistics from the Debt Management Office (DMO) on Tuesday has shown that Nigeria’s debt has risen from N12.12tn in June 2015 to N16.29tn as of June 30, 2016, indicating a N4.17tn increase.

The document from the DMO also showed that external debt by the federal and state governments stood at $11.26bn or N3.19tn as of June 30, 2016 as opposed $10.32bn or N2.03tn in July last year.

According to the DMO, Nigeria’s domestic debt rose from N8.4tn a year ago to N10.61tn as of June 2016.

The DMO in a document had said 30 per cent of the country’s domestic debt would fall due within a one-year period.

It stated, “This debt stock is slightly lower than the published FGN’s total debt stock of $55,576.28m (N10,948,526.57m), because the Debt Management Strategy tool treats the NTBs stock based on the discount values and not on the face values; while for the external debt, the tool aggregates the debt by tranche and currency, and applies a common end-period exchange rate. These gave rise to the observed difference.

“The implied interest rate was high at 10.77 per cent, due mainly to the higher interest cost on domestic debt. The portfolio is further characterised by a relatively high share of domestic debt falling due within the next one year.

“Interest rate risk is high, since maturing debt will have to be refinanced at market rates, which could be higher than interest rates on existing debt. The foreign exchange risk is relatively low given the predominance of domestic debt in the portfolio.”

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