FG spent $15bn on debt servicing in five years — CBN report

The Central Bank of Nigeria's most recent statistics shows that between 2019 and 2024, the Federal Government paid a total of $15.55 billion on debt servicing.

Nigeria made debt service payments totaling $588.33 million in 2019 and $5.40 billion in 2020.

In the years that followed, the debt service payments increased even more: $2.02 billion, $2.34 billion, and $3.43 billion were paid in 2021, 2022, and 2023.

Based on data from the CBN, the nation has paid $2.18 billion towards debt payment between January and May of 2024.

Compared to the $588.33 million in the first five months of 2019, this is a 270.9% increase.

The $2.18 billion in May 2024 is about half of the $4.8 billion that Fitch Ratings has estimated for the same period.

This rise is in spite of the government’s assertions that it is shifting its focus towards domestic borrowing.
Fitch Ratings has expressed worries regarding Nigeria's debt sustainability, estimating that the country's foreign debt servicing will increase by $400 million to $5.2 billion in the upcoming year.

The FG spent $5.40 billion, or the most of any country in the last five years, on debt financing in 2020, according to the CBN International Payments Data.
According to FBNQuest Research, Nigeria's payments for servicing its external debt increased significantly by $1.1 billion, to reach $3.5 billion in 2023.

Market debt payments totaling $1.9 billion and non-market debt payments totaling $1.6 billion make up this breakdown. Additionally, as stated in the 2024 budget, the Federal Government intends to take on more external debt, including N1.8tn in commercial borrowing and N1.1tn in concessional loans.

Because of the government's intentions to access the commercial debt markets and the expected rise in borrowing from concessional sources, FBNQuest Research anticipates an additional increase in external debt service payments, in line with Fitch Ratings' projections.

The World Bank recently gave the country $2.25 billion to promote President Bola Tinubu's economic reforms.

The two-pronged packages consist of $750 million for the Nigeria Accelerating Resource Mobilisation Reforms Program-for-Results and $1.5 billion for the Nigeria Reforms for Economic Stabilisation to Enable Transformation Development Policy Financing Programme.

"We have undertaken bold and necessary reforms to restore macroeconomic stability and put Nigeria on a path to sustainable and inclusive economic growth," stated Mr. Wale Edun, Minister of Finance and Coordinating Minister of the Economy. These changes will generate high-caliber employment and financial prospects for all Nigerians.”
According to Edun, this loan is "virtually a grant" and would help fund the government's development and economic reform programmes.

According to the study, increasing non-oil revenue and protecting oil and gas revenue are the main goals of programme development.