Between 2015 and 2021, which is six years, Nigeria’s debt portfolio increased by N26.96 trillion. This is according to the Debt Management Office (DMO).
Although during a public presentation of the country’s debt profile, the Director-General (DG) of DMO, Patience Oniha claimed that the country’s ‘debt profile’ soared by N4.03 trillion from December 2015 to December 2021.
However, contrary to her claim, Africa Check, a non-profit fact-checking organisation set up to promote accuracy in public debate and the media, analysed data from the debt office, after which it established that Oniha was referring to how much Nigeria could borrow during the period under review.
(This was brought to our attention and the figures have been updated.)
Nigeria’s actual debt between 2015 and 2021
Data from the debt office shows Nigeria’s total public debt was N12.6 trillion ($65.43 billion) as of December 2015. In December 2021, it was at N39.56 trillion ($95.78 billion). This means Nigeria’s debt profile increased by N26.96 trillion between 2015 and 2021, and not N4.03 trillion.
Secondly, Nigeria’s public debt was N39.56 trillion ($95.78 billion). The Federal Government owed N33.13 trillion of this, and state governments N6.43 trillion. External debt was N15.86 trillion ($38.39 billion), which accounted for 40.08% of the total public debt. The balance of N23.70 trillion ($57.39 billion) was domestic debt.
(This is much higher than previously reported in this article.)
Why Nigeria’s debt is justifiable -DMO
As Nigeria’s debt climbs to N45 trillion, the debt office, which already had already disclosed its plan to secure an additional N6.39 trillion to finance the 2022 budget deficit, stated that infrastructure financing is one of the reasons the country’s borrowing continues to soar.
According to DMO, Nigeria is not the only country borrowing at the moment, and the 2022 would be greatly affected if funds were not raised to support them.
“The issue of debt has become topical in Nigeria that sometimes it almost looks as if borrowing is an offence or a crime.
“The first thing we must understand is that countries across the world borrow, be it poor countries, advanced countries, developed countries, emerging markets. They all borrow.
“We usually hear complaints that debt levels are rising in Nigeria. Globally, debt levels are rising, not just in Nigeria.
“What has happened with COVID-19 is that countries needed to spend more, not only on health needs but on social needs as well, because we need to take care of people who are losing their jobs.
“We need to create incentives for the private sector to continue operating to avoid a big recession because most countries experienced a recession.
“We did as well, but we came out of it after two quarters. Government spending is one of the tools you can use properly to exit a recession.
“In Nigeria, we borrow to finance budget deficits, sometimes we borrow to finance specific projects and services like railways and airports. Financing infrastructure is an economy itself. It creates jobs across all sectors.
“We also borrow to finance maturing loan obligations like the Federal Government of Nigeria (FGN) bonds and Nigeria treasury bills,” Oniha said as she dismissed warnings by international bodies and economic experts.