- President Bola Tinubu has submitted a new borrowing request of N1.767 trillion to address Nigeria’s growing budget deficit
- The Federal Government’s foreign debt servicing jumped by 39.77% in 2024, totalling $3.58 billion by September
- Nigeria’s states collectively owe N11.47 trillion, a 14.57% rise from December 2023
President Bola Tinubu has presented a new external borrowing request to the National Assembly, seeking authorisation for N1.767 trillion under the 2024 Appropriation Act. The loan, if granted, will help cover part of the N9.7 trillion budget deficit for the year.
The request was presented to the lawmakers at Tuesday, November 19 plenary. Additionally, President Bola Tinubu forwarded the Medium-Term Expenditure Framework (MTEF) for 2025-2027 and the National Social Investment Programme Establishment Amendment Bill.
CBN highlights rising foreign debt servicing
The proposed legislation seeks to designate the social register as the primary tool for the implementation of the government’s social welfare initiatives.
According to the Central Bank of Nigeria (CBN), the Federal Government spent $3.58 billion on foreign debt servicing from January to September 2024, marking a 39.77% increase compared to the $2.56 billion spent in the same months of 2023.
The largest debt servicing payment of 2024 took place in May, totalling $854.37 million, representing a 286.52% increase from May 2023.
The CBN data also revealed significant volatility in debt servicing costs, particularly with sharp increases at the start of 2024.
In January, debt servicing payments soared by 398.89%, while February saw a modest drop. The growing debt burden on the federal government was further emphasised by a Channels Television report, which revealed a rise in the aggregate debts of Nigeria’s 36 states.
Nigeria’s public debt reaches N134.3 trillion in June 2024
The states’ total debt reached N11.47 trillion in June 2024, representing a 14.57% rise from December 2023. External debt also saw growth, rising from $4.61 billion to $4.89 billion during this time.
While other debt figures continued to rise, domestic debt for the states and the Federal Capital Territory (FCT) saw a decline. In June 2024, the overall public debt, including state debt, had reached N134.3 trillion, lower than the figure recorded in December 2023.
The ongoing rise in foreign debt, coupled with domestic fiscal challenges, continues to intensify Nigeria’s debt servicing burden.
The report from BudgIT revealed that many states are largely dependent on federal funding, with 32 states receiving at least 55% of their revenue from the Federation Account Allocation Committee (FAAC).
FG approves N75 billion loan scheme at 9% interest rate for MSMEs
Meanwhile, TheRadar earlier reported that FG approved a N75 billion loan scheme for Micro, Small and Medium Enterprises (MSMEs).
The loan, disbursed in partnership with BOI and others, guaranteed a nine per cent interest rate.