Nigeria’s total public debt stock has surged by N12.6tn in three months to N134.3tn ($91.3bn) by the end of the second quarter of 2024
This is a 10.35 per cent increase from the N121.7tn ($91.5bn) recorded in the first quarter of this year.
The rise has been attributed primarily to the devaluation of the naira, according to an official document seen by newsmen which was presented at a session on the sidelines of the World Bank/IMF annual meetings in Washington DC as Nigeria hosted foreign investors.
The document stated, “In Q2 2024, the debt stock grew in naira terms to N134.3tn ($91.3bn) from N121.7tn ($91.5bn) in Q1 2024, driven mainly by exchange rate devaluation. The dollar amount of debt was roughly the same.”
Although it looked like Nigeria’s debt is reducing in dollar terms, newsmen observed that there was an increase of N5.55tn or 8.45 per cent in domestic debt, from N65.65tn in Q1 2024 to N71.2tn by Q2 2024.
Also, there was an increase of $780m in external debt from $42.12 bn in the first quarter of this year to $42.9bn by June 2024.
The document seen by newsmen showed that domestic debt continued to dominate Nigeria’s public debt portfolio in Q2 2024, accounting for 53 per cent of the total debt stock at N71.2tn ($48.4bn).
External debt made up 47 per cent, amounting to N63.1tn ($42.9bn).
The document also showed that Nigeria’s debt-to-GDP ratio has exceeded 50 per cent.
It also showed that FGN Bonds represented 78 per cent of the domestic debt, affirming the government’s reliance on local bond markets for financing.
Other domestic instruments include Nigerian Treasury Bills, Savings Bonds, Sukuk, Promissory Notes, and Green Bonds, indicating a diverse borrowing strategy.
On the external front, multilateral loans accounted for 50.4 per cent of the total external debt, reflecting Nigeria’s preference for financing from international bodies such as the World Bank and the African Development Bank.
Bilateral loans made up 13.7 per cent, while commercial loans represented 35.9 per cent of external debt.
Speaking earlier during the meeting with investors on Wednesday, Wale Edun, Nigeria’s Minister of Finance and Coordinating Minister of the Economy, announced that the country’s $500m domestic bond was oversubscribed, raising over $900m from investors.
This achievement comes despite prior advice from the International Monetary Fund against issuing the bond.
