Under Buhari, Nigeria's Indebtedness to China and World Bank Has Surged to $17.64 Billion
- Nigeria's debt to China in the last eight years of Buhari's administration has tripled
- As of June 2015, the country's debt to China stood at $1.6 billion and ballooned to $4.29 billion as of June 30, 2022
- Also, the country's indebtedness to the World Bank increased to over $14 billion as of last year
Nigeria's indebtedness to China has grown by 209% in the last eight years since President Muhammadu Buhari was Nigeria's leader.
During this period, Nigeria was named the world's poverty capital, with 133 million people living in abject poverty, overtaking India despite massive borrowings.
Source: Facebook
Buhari's government began borrowing almost one month after coming to office
The country's statistics body, the National Bureau of Statistics, has said Nigeria suffers from multidimensional poverty.
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Total borrowings from China increased to $4.29 billion in December 2022 from $1.39 billion in June 2015, one month after Buhari became Nigeria's president.
The Debt Management Office (DMO) said China's loans to Nigeria account for 84.73% of the country's bilateral debt, while the rest are from France, Japan, India, and Germany.
Per the DMO, China's loans to Nigeria are concessional loans with interest rates of 2.50% annually with a tenor of 20 years and a grace period of seven years.
Ayodele Oni of Bloomfield LP told BusinessDay that Nigeria had taken more loans under Buhari than ever in the country's history.
Nigeria's low revenue and spiking interest on payments have left its economy with almost no money to fund critical infrastructure.
BusinessDay reports that low revenue generation has led to constant fiscal deficits partially funded with expensive loans from the Central Bank of Nigeria (CBN), which raises the debt stock-to-GDP ratio to 38%, below the 40% self-imposed debt ceiling set by the Nigerian government.
Nigeria's indebtedness to World Bank is now N6tn
The World Bank has said Nigeria is in a more precarious position than before the global oil boom of late 2021.
Meanwhile, Nigeria's borrowing from the World Bank has spiked by 121.46% under Buhari.
Punch reporting says Nigeria's total debt owed to the World Bank spiked to $7.64, about N3.52 trillion, at a CBN exchange rate of N460.53 per dollar.
Nigeria's Debt to the World Bank rose from $6.29 billion as of December 2015 to $13.93 billion as of December 2022, data from DMO's external debt stock says.
Reports say the International Development Association and the International Bank Reconstruction and Development comprise of the Washington-based bank, have given Nigeria loans over the years.
The IBRD lends to governments of middle-income and creditworthy low-income countries, while IDA provides concessionary loans known as credits and grants to governments of the poorest countries.
The IBRD lends to governments of middle-income and creditworthy low-income countries, while the IDA provides concessionary loans – called credits – and grants to governments of the poorest countries.
Available data shows Nigeria had a debt of 6.29 billion from IDA and $3.57 million from IBRD. By 2022, total IDA borrowings were about $11 billion, and $12 billion in 2021.
The data showed that in 2016, Nigeria had a debt of $6.29bn from IDA and $3.57m from IBRD, but by 2022, the borrowing through IDA was $13.45bn while the one from IBRD was $487.03m.
World Bank loans are usually tied to various projects across the country.
Nigeria ranks 4th most indebted country to World Bank
According to the World Bank Fiscal Year 2021 audited records known as the IDA financial statement, Nigeria was rated gift on the list of debtors with $11.7bn IDA debt stock as of June 30, 2021.
The World Bank Fiscal Year 2021 audited financial statements, known as the IDA financial statement, showed that Nigeria was rated fifth on the list with $11.7bn IDA debt stock as of June 30, 2021.
But the recently released World Bank Fiscal Year 2022 audited financials for IDA revealed that Nigeria is now fourth with $13 billion IDA debt stock as of June 30, 2022.
The recent record shows that Nigeria has amassed about $1.3 billion in debt within the fiscal, with the country dislodging Vietnam from the fourth position.
The IDA debt differs from the Bank's International Bank for Reconstruction and Development.
All the top countries on the list reduced their debts slightly except for Nigeria.
The top five countries on the list slightly reduced their IDA debt stock, except for Nigeria.
World Bank said:
"Nigeria's debt remains sustainable, albeit vulnerable and costly, especially due to large and growing financing from the Central Bank of Nigeria."
Good news: Nigeria successfully repays China, Islamic Bank, Arab Bank, IMF and others N3.63tn Debt
Legit.ng reported that according to data from the Debt Management Office (DMO) obtained by Legit.
Nigeria spent N3.63 trillion servicing its external and domestic debts in 2022. The payments were made to creditors, which include the Chinese government, Islamic Bank, the Arab Bank, and International Monetary Fund, among several others.
A check on DMO data shows Nigeria used the exchange rate of N448.08 to pay off the external debt of $2.40 billion, which amounted to N1.07 trillion.
Source: Legit.ng
