Nigeria's highest debt of USD 85.9 billion becomes talking point

Nigeria's debt of USD 85.9 billion, the highest in history, has become the talking point even as the country celebrated its 60th anniversary on October 1, 2020, according to a news report by Daily Monitor.

The pressure on the economy has caused an 8.31 percent increase in debt owed from a total of USD 79.3 billion recorded in March. By December 2005, Nigeria was rated as one of the most heavily indebted countries, owing USD 33.9 billion.

Now the talk is on whether the money borrowed had helped or burdened the country.

Abuja’s debt obligation had gone down in 2006 after the country got debt relief. The Paris Club of creditors wrote off USD 18 billion of that debt, while the country paid off the balance and became largely debt-free.

However, in the years that followed, the public debt spiraled as officials argued for funding budget deficits and critical infrastructure.

According to the National Bureau of Statistics, 34.89 percent of the total federal and state public debt is external while domestic accounts for 65.11 percent.

The Debt Management Office (DMO) reported that the increase by USD 6.593 billion was accounted for by the USD 3.36 billion budget support loan from the International Monetary Fund, new domestic borrowing to finance the revised 2020 Appropriation Act, including the issuance of Sukuk, and Promissory Notes issued to settle claims of exporters.