As of the end of September, the total public debt surged to N87.91tn. Rather than augment its foreign debt stock, a significant reduction was observed overall. In the third quarter of 2023, Nigeria's total public debt marginally increased by 0.61 per cent quarter-on-quarter, reaching N87.91tn from N87.38tn at the end of the second quarter.
According to the recently released debt stock data from the Debt Management Office, the total external debt amounted to N31.98tn, while domestic debt stood at N55.93tn during the reported period.
In its report, the DMO explained, "At N87.91tn, the total public debt stock represents a marginal increase of 0.61 per cent when compared to the June 30, 2023, figure of N87.38tn. This trend is explained by the decrease in external debt from $43.16bn as of June 30, 2023, to $41.59bn as of September 30, 2023, and a relatively moderate increase of N1.8tn in the domestic debt."
The decrease in external debt was attributed to the redemption of a $500m Eurobond and the payment of $413.859m as the first principal payment of the $3.4bn loan obtained from the International Monetary Fund in 2020 during Covid-19.
In Q3, 2023, the Federal Government allocated $1.39bn to service external debt and N1.79tn for domestic debt servicing.
Patience Oniha, the Director-General of the Debt Management Office, revealed that rates on blue-chip securities are elevated due to high inflation rates in the West.
She said, “For the international market, rates on blue chip securities, the US government, the UK government, are high because of the inflation rate.
“Also, there is still uncertainty around the world from the Russia-Ukraine war. So foreign investors are a bit more cautious. They are investing in securities that are triple A or double A ratings that are offering them high rates, four per cent, five per cent.”
She, however, noted that stability is beginning to return to these countries with the US Feb being speculated to retain its rates in 2024.
Commenting on domestic borrowing, she revealed that the Federal Government has raised N7.04tn as total new domestic borrowing in 2023.
