Nigeria’s foreign debt rises 40 percent to $9.38bn

The Debt Management Office (DMO), on Tuesday, said Nigeria’s foreign debt rose 40 per cent  to $9.38 billion, from its last publicly available data of $6.7 billion as at March 2013.

The debt office valued local debt at N8.9 trillion ($55 billion), up 37.1 percent from the N6.49 trillion declared in March 2013.

But the Debt-to-GDP ratio is 12.51 percent of its rebased GDP, down from 21 percent at end-March 2013, the DMO said.

Nigeria rebased its GDP calculations in April, almost doubling its GDP to more than $500 billion, making it Africa’s top economy.

“This is not an indication that Nigeria can borrow without caution … because our tax GDP ratio is very low,” DMO director general Abraham Nwankwo told reporters.

He said tax revenue as a percentage of GDP was just 6 percent.

Nigeria has said it wants to increase the amount it borrows overseas to around 40 percent of all debt over a three to five year period, to take advantage of ultra-loose monetary policy in the West to lower its funding costs.

Foreign borrowing stood at 12 percent of total debt in 2013.