The external debt stock of the nation’s 36 states and the Federal Capital Territory (FCT) as at December, 31, 2012 has been put at $2.384 billion (about N379.056 billion), according to figures made available to BusinessDay by the Debt Management Office (DMO).
This level of external debt represents 0.88 percent of Nigeria’s GDP, which has been estimated at $270 billion as at 2012.
Out of the total of $2.384 billion, which was mainly multilateral external debt, Lagos, Kaduna, and Cross River states accounted for about 40 percent, BusinessDay investigation showed.
Lagos State is leading other states with an external debt stock of $611.253 million (about N97.189 billion), followed by Kaduna State which owes $215.683 million (about N34.293 billion) and Cross River State which carries a debt stock of $113.034 million (about N17.972 billion).
State’s whose external debt stock is low in the period under review are Borno, Delta and Plateau. Borno State has the lowest external debt stock worth of $14.154 million (about N2.250 billion); Delta is carrying $18.997 million (about N3.020 billion) worth of external debt; while external debt stock of Plateau State as at December 31, 2012 review period worth $21.934 million (about N3.487 billion).
External debt (or foreign debt) is that part of the total debt in a country that is owed creditors outside the country. The debt includes money owed to private commercial banks, other governments, or international financial institutions such as the International Monetary Fund (IMF) and World Bank.
Details available to BusinessDay show that external debt stock of Abia State stood at $35.911 million; Adamawa State, $30.225 million; Akwa Ibom State, $61.664 million; Anambra State, $26.708 million; Bauchi State, $67.131 million; Bayelsa State, $28.002 million; Benue State, $28.420 million; Ebonyi State, $41.581 million; Edo State, $42.741 million; Ekiti State, $36.165 million; Enugu State, $50.074 million; Gombe State, $31.727 million; Imo State, $51.973 million; and Jigawa State, $33.669 million.
While commenting on the rising debt profile of the states, analysts at FBN Capital said, “The more enterprising states like Lagos are able to justify their levels of leverage by the extent of their infrastructural development, income generating capacity and large population size. However, for some states there is disconnect between their respective debt levels and supposed deliverables.”
Analysts also faulted the basis of rising external debt profile of oil rich states, particularly those that are with very limited infrastructure and densely populated of all the states despite being largely oil economy.