Nigeria’s overall debt to the World Bank Group increased by $660 million in the first six months of 2022. This is based on data from both the Debt Management Office (DMO) and the World Bank’s financial filings. Nigeria’s debt to the Washington-based bank was $12.38 billion as of December 31, 2021.
According to the World Bank’s financial disclosures for fiscal year 2022, Nigeria owed the lending organization $13.04 billion as of June 30, 2022. The World Bank, comprised of the International Bank for Reconstruction and Development and the International Development Association, has made loans to Nigeria over the years.
The IBRD lends to governments of middle-income and creditworthy low-income countries, whereas the IDA grants and makes concessionary loans to governments of the poorest nations.
Nigeria’s debt to the IDA and IBRD remained at $12.55 billion and $486 million, respectively, as of June 30, 2022, up from $11.97 billion and $410.60 million on December 31, 2021.
According to a recent Punch story, Nigeria has risen to the top of the World Bank’s list of the top ten IDA borrowers.
Nigeria was ranked fifth in the World Bank Fiscal Year 2021 audited financial accounts for IDA, having $11.7 billion in IDA debt stock as of June 30, 2021.
However, the newly released World Bank Fiscal Year 2022 audited financial statements for IDA showed that Nigeria has moved to the fourth position on the list, with $13bn IDA debt stock as of June 30, 2022.
This shows that Nigeria accumulated about $1.3bn in IDA debt within a fiscal year, with the country taking over the fourth top debtor position from Vietnam. This debt is different from the outstanding loan of $486m from the World Bank’s International Bank for Reconstruction and Development. The top five countries on the list slightly reduced their IDA debt stock except for Nigeria.
Nigeria has the highest IDA debt in Africa, as the top three IDA borrowers (India, Bangladesh and Pakistan) are from Asia. The World Bank disclosed recently that Nigeria’s debt, which might be considered sustainable for now, was vulnerable and costly.
The bank said, “Nigeria’s debt remains sustainable, albeit vulnerable and costly, especially due to large and growing financing from the Central Bank of Nigeria.”
However, the Washington-based global financial institution added that the country’s debt was also at risk of becoming unsustainable in the event of macro-fiscal shocks. The bank further expressed concerns over the nation’s cost of debt servicing, which according to it, disrupted public investments and critical service delivery spending.
