The Debt Management Office (DMO) has revealed that the Nigerian government borrowed N4.365 trillion in 2017, bringing the country’s total debt stock to N21.725 trillion.
The Director General of the DMO, Patience Oniha, stated this on Wednesday, March 13, during a press conference in Abuja.
Oniha said the federal government is planning to reduce domestic debt to 60 percent to the total debt stock from the present 73 percent.
She added that the new debt stock represents 18.20 per cent of Nigeria’s Gross Domestic Product (GDP) for 2017.
“This indicates that the debt is sustainable and within the 56 per cent threshold for countries in Nigeria’s peer group,” said Oniha.
“The key benefits of the restructuring of the portfolio are the reduction of the government’s debt-service costs, lowering of interest rates in the domestic market and improved availability of credit facilities to the private sector,” She said.
“Our projection is that from two sources, the borrowing should be dropping in the medium term. The rate of increase will be much slower, and instead of borrowing 17-18 percent from the domestic market, we’ll do 7 percent from external sources.”
She said Nigeria had to increase borrowing because the output and price of crude fell in 2014, which reduced government revenue and eventually plunged the economy into its worst recession in 25 years.
The DG also noted that the debt consisted of N15.938 trillion domestic borrowings for the Federal Government, the 36 states and the Federal Capital Territory (FCT).
This represents 73.36 per cent of the entire debt stock, with the external component consisting of a balance of N5.787 trillion, representing 26.64 per cent.
A further breakdown indicates the domestic debt for the Federal Government was N12.589 trillion, while that of states and the FCT was N3.348 trillion.