New borrowings push up Nigeria’s debt stock to N31trn

Budget Support Loan from the International Monetary Fund as well as new domestic borrowing to finance the Revised 2020 Appropriation Act raised Nigeria’s public debt stock to N31.009 trillion or ($85.897bn) as at June 30, 2020, according to the latest data released by the Debt Management Office (DMO).

The total debt stock jointly accumulated by the Federal, 36 State Governments as well as the Federal Capital Territory rose by N2.381 trillion ($6.593bn) from the N28.628trillion reported in March this year.

“The increase in debt stock was accounted for by the USD3.36 Billion Budget Support Loan from the International Monetary Fund, New Domestic Borrowing to finance the Revised 2020 Appropriation Act including the issuance of the N162.557 Billion Sukuk, and Promissory Notes issued to settle Claims of Exporters,” the DMO stated in a debt report released on Wednesday.

The federal government revised the 2020 budget in the face of the adverse impact of COVID-19 pandemic coupled with low oil prices on Revenues and increased expenditure needs on health and economic stimulus amongst others.

N5.365 trillion of the budget is intended to be funded by domestic and foreign borrowing while direct revenue funding will cover N5.158 trillion.

The DMO said it now expects the Public Debt Stock to further expand as government raises the balance of the New Domestic Borrowing and disbursements on funding support by the World Bank, African Development Bank and the Islamic Development Bank come in. The expected funding support from these multilateral agencies are part of arrangements to finance the revised 2020 Budget.

According to the debt office, Promissory Notes are expected to be issued in the course of the year, which, in addition to new borrowings by State Governments are also expected to increase the Public Debt Stock.