Nigeria’s foreign debt rises by 6.42% in one year

• Lagos, Kaduna, Edo top list of foreign debtors

By Odunewu Segun

Nigeria’s foreign debt has risen to $11.41bn from the $10.72bn it was as at December 31, 2015, recording a 6.42 per cent in a little over a year, National Daily has gathered.

Statistics obtained from the Debt Management Office (DMO) showed that while the Federal Government’s foreign debt stood at $7.84bn as of December 31, 2016, the 36 states of the federation and the FCTA owed  $3.57bn.

Of the country’s foreign debt, $7,988,221,870 came from multilateral agencies, including the World Bank and the African Development Bank.

Another $198,245,989 came from France’s Agence Francaise De Development, while $3,219,808,738 came from bilateral agencies such as the China EXIM Bank and the Japanese International Cooperation Agency.

The Federal Government’s component of the foreign debt profile rose from $7.35bn to $7.84bn in the period, thereby showing an increase of 6.67 per cent.

On the other hand, the subnational foreign debt rose from $3.37bn as of December 31, 2015 to $3.57bn as of December 31, 2016. This shows an increase of 5.87 per cent.

Among the subnational governments, Lagos, Kaduna, Edo, Cross River and Ogun states retained the top spots on the list of foreign debtors.

Out of the subnational debt of $3.57bn, Lagos had a share of $1.38bn. This means that Lagos owed 38.7 per cent of the nation’s subnational foreign debt. Kaduna State came second with a foreign debt of $222.88m; Edo, $183.64m; and Cross River, $114.99m.

In the previous year, the foreign debt profile of the topmost states stood at Lagos, $1.21bn; Edo, $168.19m; Cross River, $ 136.4m; and Ogun, $103.33m.

The rate of the rise in foreign debt has been slower than that of domestic debt. In recent times, the Federal Government has been making attempts to increase the proportion of foreign debt, because of the higher interest rate charged on domestic debts.

The attempts, however, have not yielded the expected result with the consequence that the Federal Government has resorted to the local market where it raises funds every month through the instrument of FGN Bonds and Nigeria Treasury Bills.

Currently, the Federal Government is in the process of securing $500m from Eurobond.