Amid shrinking revenue, Nigeria’s debt hits N42.8trn

Nigeria’s total public debt stock has increased from N41.60tn as of March 2022 to N42.84tn as of June of the same year, showing an increase of N1.24tn in three months.

This is according to a press statement published on the Debt Management Office’s (DMO) website on Monday, September 19, 2022.

The statement read in part, “The Total Public Debt Stock, representing the Domestic and External Debt Stocks of the Federal Government of Nigeria, the 36 State Governments and the Federal Capital Territory, was N42.84tn ($103.31bn) as of June 30, 2022. The comparative figures for March 30, 2022, was N41.60tn ($100.07bn).”

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The DMO noted that external debt remained the same at N16.61tn ($40.06bn) from Q1 to Q2 2022, adding that 58 per cent of external debts were concessional and semi-concessional loans from multilateral lenders such as the World Bank, the International Monetary Fund, Afrexim and African Development Bank and bilateral lenders including Germany, China, Japan, India and France.

It also noted that domestic debt rose to N26.23tn ($63.24bn) due to new borrowings by the government to part-finance the deficit in 2022 Appropriation {Repeal and Enactment) Act, as well as new borrowings by State Governments and the FCT.

The DMO further said that the Total Public Debt to GDP as of June 30, 2022, was 23.06 percent compared to the ratio of 23.27 percent as of March 36, 2022, adding that the Debt Service-to-Revenue Patio remained high.

Meanwhile, Nigeria’s inflation has also hit an almost 17-year high as the price of goods and services surged further by 20.52 percent in the month of August 2022 from 19.64 percent recorded in the previous month.

This was contained in the National Bureau of Statistics (NBS) consumer price index (CPI) report for August 2022, released on Thursday, September 15, 2022.

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According to NBS, the rate was 3.52 percent higher than the 17.01 percent recorded in August 2021.

The report also showed that the urban inflation rate stood at 20.95 percent, 3.36 percent higher than the 17.59 percent recorded in August 2021. The rural inflation rate in August 2022 was 20.12 percent on a year-on-year basis; 3.69 percent higher than the 16.43 percent recorded in August 2021.

According to the report, increases were recorded in all classifications of individual consumption according to purpose (COICOP) divisions that yielded the headline index.

“On a month-on-month basis, the headline inflation rate in August 2022 was 1.77 percent, this was 0.05 percent lower than the rate recorded in July 2022 (1.82 percent). This means that in August 2022 the headline inflation rate (month–on–month basis) declined by 0.05 percent,” the report reads.

“The percentage change in the average CPI for the twelve months period ending August 2022 over the average of the CPI for the previous twelve months period was 17.07 percent, showing a 0.47 percent increase compared to 16.60 percent recorded in August 2021.”

The report added that food inflation rose to 23.12 percent in August 2022 on a year-on-year basis, representing a 2.82 percent increase when compared to 20.30 percent in August 2021.

“This rise in the food inflation was caused by increases in prices of bread and cereals, food products like potatoes, yam and other tubers, fish, meat, oil and fat,” it added.

“On a month-on-month basis, the food inflation rate in August was 1.98 percent, this was a 0.07 percent decline compared to the rate recorded in July 2022 (2.04 percent).

“This decline is attributed to the reduction in prices of some food items like tubers, garri, local rice, and vegetables.

“The average annual rate of food inflation for the twelve-month period ending August 2022 over the previous twelve-month average was 19.02 percent, which was a 1.48 percent decline from the average annual rate of change recorded in August 2021 (20.50 percent).”

The report further analysed price movements for states, Anambra and Ondo were the highest.

“In August 2022, food inflation on a year-on-year basis was highest in Kwara (30.80 percent), Ebonyi (28.06 percent) and Rivers (27.64 percent), while Jigawa (17.77 percent), Zamfara (18.79 percent) and Oyo (19.80 percent) recorded the slowest rise on year-on-year food inflation.

“On a month-on-month basis, however, August 2022 food inflation was highest in Anambra (3.05 percent), Ondo (2.92 percent), and Bauchi (2.78 percent), while Yobe (0.46 percent), Oyo (0.89 percent) and Delta (0.94 percent) recorded the slowest rise on month-on-month inflation.”

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