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The Federal Government’s appetite for foreign loans is waning, the latest data from the Debt Management Office has revealed.
This is as total public debt rose to N87.91tn as of the end of September. Rather than increase its foreign debt stock as has been the case before now, a significant reduction was witnessed overall. In the third quarter of 2023, Nigeria’s total public debt rose marginally by 0.61 per cent quarter-on-quarter to N87.91tn from N87.38tn as of the end of the second quarter.
This is according to new debt stock data from the Debt Management Office released on Wednesday. The data disclosed that total external debt stood at N31.98tn while domestic debt amounted to N55.93tn in the period being reported.
Commenting on its report, DMO said, “At N87.91tn, the total public debt stock represents a marginal increase of 0.61 per cent when compared to the June 30, 2023, figure of N87.38tn. This trend is explained by the decrease in external debt from $43.16bn as of June 30, 2023, to $41.59bn as of September 30, 2023, and a relatively moderate increase of N1.8tn in the domestic debt.
“External debt decreased due to a redemption of a $500m Eurobond and the payment of $413.859m as the first principal payment of the $3.4bn loan obtained from the International Monetary Fund in 2020 during Covid-19.”
In Q3, 2023, the Federal Government spent $1.39bn servicing external debt and N1.79tn on domestic debt servicing.
On the backs of numerous agitations about the debt status of the country and if the government will default, DMO stated that the recent debt servicing demonstrates the government’s commitment to honour its debt obligations.
Rates on blue-chip securities are high because of high inflation rates in the West, the Director-General of the Debt Management Office, Patience Oniha, disclosed recently.
While speaking on the sidelines of the discussions for the establishment of the African Debt Managers Initiative Network spearheaded by the African Development Institute of the African Development Bank in Abuja, she noted that the government has been focused more on the domestic market.
She, however, noted that stability is beginning to return to these countries with the US Feb being speculated to retain its rates in 2024.
Commenting on domestic borrowing, she revealed that the Federal Government has raised N7.04tn as total new domestic borrowing in 2023.