Nigeria’s total public debt has risen to N26.215 trillion, according to figures from the Debt Management Office.<\/p>\n
The figure were released to different stakeholders at interactive sessions by the DMO, but the huge figures were incurred by the Federal Government, the 36 State Governments and the<\/p>\n
Details on the interactive sessions released by the DMO shows that the comparative figure for September 2018\u00a0was N25.701 Trillion, implying \u00a0that\u00a0in the 12 months period\u00a0 to\u00a0 September\u00a02019 the Total\u00a0Public Debt grew by 16.88%.<\/p>\n
The DMO\u00a0also\u00a0stated\u00a0that\u00a0the Total Public Debt as at September 2019 includes Promissory\u00a0Notes in the amount of\u00a0N812.650\u00a0billion\u00a0which had been issued to settle the FGN\u2019s arrears to Oil Marketing Companies and State Governments under the Promissory Programme approved by the Federal Executive Council and the National Assembly.<\/p>\n
In addition, the stakeholders at the Interactive Sessions were \u00a0informed\u00a0 that whereas the 2019 Appropriation Act provided for a total New Borrowing of N1, 605.63 Billion split equally between \u00a0Domestic and External, only the domestic component of N802.82 Billion was raised due to the late passage of the 2019 Appropriation Act and the expectation that the implementation of the 2020 Budget would commence on January 1, 2020<\/p>\n
The Debt Management Office (DMO) at a series of Interactive Sessions presented a review of activities and its plans for raising capital from domestic and external sources in the year 2020.<\/p>\n
The\u00a0sessions\u00a0involved banks and institutional investors in the Federal Government of Nigeria (FGN)\u00a0securities amongst which were Pension Funds\u00a0 Administrators (PFA), Insurance \u00a0Companies, Fund and Asset Managers.<\/p>\n
A similar\u00a0Interactive\u00a0Session was held with the media on January 17,\u00a02020.<\/p>\n
At the Interactive Sessions which held in Lagos and Abuja, the DMO stated amongst others, that the level of New Borrowings in the Appropriation Acts declined consistently since Nigeria exited the recession in the year 2017. It also reiterated the fact that the increase in the New Borrowings in the Appropriations Acts between 2015 and 2017 was due to the need to stimulate growth and create jobs in the economy as contained in the Economic Recovery Growth Plan (ERGP).<\/p>\n
Amongst the highlights\u00a0of\u00a0the DMO\u2019s achievements for 2019\u00a0was\u00a0the issuance of a 30-year FGN Bond\u00a0for the first\u00a0time. The\u00a0introduction of the 30-year Bond was to meet the investment needs of\u00a0long-term\u00a0investors such as insurance companies and support the development of the domestic financial markets in areas\u00a0such asmortgages. From\u00a0the FGN perspective the 30-year \u00a0Bond\u00a0 also\u00a0 contributed to reducing\u00a0the refinancing risks of the Public Debt Stock.<\/p>\n
The\u00a0product\u00a0has\u00a0enjoyed a\u00a0 strong\u00a0 demand\u00a0as\u00a0N284.391\u00a0billion\u00a0had been issued\u00a0by the end of\u00a0September\u00a02019.<\/p>\n
The Ratio of Domestic Debt to External Debt at 69:31 as at September 2019 was an improvement over the Ratio \u00a0of 71:29 \u00a0as at September 2018 compared to the target of 60:40 in the Medium-Term Debt Management Strategy. The Ratio of Long Term to Short Term Debt in the Domestic Debt as at September 2019 was 80:20, which shows that the target of 75:25 had been outperformed by September 2019. Furthermore, it was an improvement over the Ratio of 73:23 recorded in September 2018.<\/p>\n
Similarly, Total Debt as a percentage of GDP was 18.47% as at September 2019 was well within the limit of 25% and fares better in comparison with the Debt\/GDP ratios of countries such as the United States of America, United Kingdom and Canada with ratios of 105%, 85% and 90% respectively for the same period.<\/p>\n
However, because they generate adequate revenues, their Debt Service\/Revenue Ratios for the same period were much lower at 12.5%, 7.5% and 7.5% respectivelywhen compared to Nigeria\u2019s 51% in 2017<\/p>\n
The low revenue base of\u00a0Nigeria\u00a0relative to its GDP is clearly\u00a0reflected in the high Debt Service to Revenue\u00a0Ratio.\u00a0This clearly brings to fore, the need for revenues to grow.\u00a0The\u00a0efforts\u00a0towards increasing and diversifying revenue such as the\u00a0passage of the\u00a0Finance\u00a0Act and Strategic Revenue Growth Initiative of the Federal Ministry of Finance, Budget and National Planning should\u00a0thus\u00a0be supported.<\/p>\n
The DMO also unveiled its plans \u00a0for\u00a0 the\u00a0year 2020,\u00a0based on the\u00a0New \u00a0Borrowings in the 2020\u00a0Appropriation \u00a0Act,\u00a0which comprises of N850\u00a0billon\u00a0and N744.99 billion for External and Domestic Borrowings\u00a0respectively.<\/p>\n
The\u00a0New\u00a0Domestic\u00a0Borrowings will be raised through FGN Bonds, Sukuk, FGN savings Bonds and possibly Green\u00a0 Bonds.\u00a0For\u00a0External\u00a0Borrowings the\u00a0 strategy is to first seek out concessionary and semi\u00a0concessionary loans due to the lower interest rate and longer tenors. Any shortfall thereafter may be raised from commercial sources.<\/p>\n","protected":false},"excerpt":{"rendered":"
Nigeria’s total public debt has risen to N26.215 trillion, according to figures from the Debt Management Office. The figure were released to different stakeholders at interactive sessions by the DMO, but the huge figures were incurred by the Federal Government, the 36 State Governments and the Details on the interactive sessions released by the DMO […]<\/p>\n","protected":false},"author":7,"featured_media":14935,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,7],"tags":[277,676,799],"class_list":["post-23912","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","category-news","tag-debt","tag-fg","tag-states"],"_links":{"self":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/posts\/23912","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=23912"}],"version-history":[{"count":0,"href":"https:\/\/everyday.ng\/index.php?rest_route=\/wp\/v2\/posts\/23912\/revisions"}],"wp:attachment":[{"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=23912"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=23912"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/everyday.ng\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=23912"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}