NIGERIA DEBT: what you should know about Nigeria’s debt

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By STATISENSE

Total Debt of the country has two components – External & Domestic.

The Country’s debt is the sum of Federal Govt’s Debt, the 36 States Govts’ Debt, and the FCT Debt.

Each Entity therefore have its own External Debt & Domestic Debt.

Total Public Debt as of March 2024 is ₦121.67 trillion, which is $91.46 billion in USD.

Indeed, from $ perspective, Nigeria’s Total Public Debt reduced from $108.23 billion in Dec 2023 to what it is now — $91.46 billion (Mar 2024).

So, because of the varying interpretation depending on the perspective of reporting — ₦ or $ — Debt is better disagreegated.

Domestic Debt might be better reported in the currency of repayment, same for External Debt.

⭕SO WHERE IS THE INCREASE OR OTHERWISE FROM?

Here is the disaggregated figure
🚩Domestic Debt
Dec 2023: ₦59.12 trillion
Mar 2024: ₦65.65 trillion
This means Domestic Debt increased by 11.04% (₦6.53 trillion)

🚩External Debt
Dec 2023: $42.50 billion
Mar 2024: $42.12 billion
This means External Debt reduced by -0.90% ($379.62 million)

So, while the Domestic Debt increased by ₦6.53 trillion in 3 months, the External Debt reduced by $379.62 million within the same period.

⭕WHAT REALLY IS THE CAUSE OF THE REPORTED INCREASE?

FX!

Foreign Exchange influence on Nigeria’s Debt is highly significant.

While External Debt reduced in $ by $379.62 million, in ₦ term, it increased by ₦17.80 trillion.

The real driver therefore, is exchange rate that rose from $1/₦899.39 in Dec 2023 to $1/₦1,330.26 in Mar 2024.

In summary, Nigeria’s Total Public Debt increased from Domestic perspective (₦6.53 trillion) but reduced by $379.62 million from External Debt perspective.

#Statisense