DMO raises concerns over Nigeria’s rising debt burden

The Debt Management Office (DMO) has raised concerns as Nigeria’s public debt is set to hit N72 trillion.

Patience Oniha, the DG of DMO raised the concerns on Wednesday at the public presentation and a breakdown of the highlights of the 2023 Appropriation Act in Abuja.

Oniha stressed that the huge fiscal deficit in the budget can only be reduced by an improvement in revenue generation.

The expected increase in the total debt stock is a combination of the current debt stock, government loan to CBN, new borrowings in the 2023 budget, issuance of Promissory Notes, and cost of debt service.

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The federal government is looking forward to borrowing a fresh N8.8 trillion loan from domestic and international markets to implement its ambitious 2023 budget of N21.83 trillion.

Nigeria’s total debt stock stood at N44 trillion as of September 2022. The public debt is an aggregation of the federal government, 36 state governments, and the Federal Capital Territory debts.

“So, if you add the new borrowing, again, the budget is for the full year, it’s not like we are tying the new borrowing in the budget to be raised before the end of this administration. Certainly, some part of that could be done; give or take – depending on market conditions – N5 trillion. So, we are looking at about N72 trillion at about June; again, depending on market conditions,” Oniha explained.

The DMO DG however assured that the federal government did not borrow much in the last quarter of 2022.

According to her, much of the borrowing was done in September.

“When the last quarter borrowing figure is released, it won’t be significantly different from the public debt as at September 2022” she added.