Atiku Fumes as NNPC Secures $3 Billion Loan to Stabilise Naira as Nigeria's Debt Hits 49.8 Trillion
- The newly procured NNPC crude oil swap $3 billion loan from Afreximbank has ballooned Nigeria's debt profile
- The NNPC said it took the loan to stabilise the volatile foreign exchange market
- But ex-Vice President Atiku Abubakar's aide, Phrank Shaibu, has knocked the NNPC over the loan and supposedly usurping CBN's powers
Nigeria's total debt profile has increased to N52.2 trillion from N49.8 trillion, which the Debt Management Office (DMO) said it was as of March 31, 2023.
The increase was initiated by the newly procured $3 billion loan by NNPC from Afreximbank to stabilise the naira and see Nigeria through the crucibles of the petrol subsidy removal.
Source: Getty Images
Will NNPC crude oil swap agreement stabilise naira
The facility was procured via a crude oil agreement signed between Afreximbank and the Nigeria National Petroleum Company Limited (NNPCL).
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On Wednesday, August 16, 2023, the Nigerian oil firm revealed that it signed a commitment letter and Termsheet with the bank for an urgent $3 billion crude oil repayment loan to cool the chaotic Forex market.
At the official exchange rate of N774.77 per dollar published on FMDQ on Tuesday, August 15, 2023, the $3 billion loan equals about N2.3 trillion or 1% of Nigeria's existing N49.8 trillion as of March 31 this year.
The N49. trillion is not part of the N22.7 trillion Ways and Means Advances from the Central Bank of Nigeria (CBN) to the Nigerian government.
FG owes CBN N22.7 trillion
The government of former President Muhammadu Buhari had restructured the N22.7 trillion Ways and Means Advances with the approval of the Senate earlier in the year.
The ex-president's government revealed that it relied so much on the Ways and Means during revenue shortfalls.
Added to the N22,7 trillion Ways and Means balance, Nigeria's debt profile had skyrocketed to N75 trillion.
Reports say that the NNPC revealed that the loan would provide some immediate distribution to support the Nigerian government's fiscal and monetary policy reforms to stabilise the FX market.
Atiku knocks Tinubu, says NNPC usurped CBN's role
Meanwhile, the Special Assistant on Public Communication to ex-Vice President Atiku Abubakar, Phrank Shaibu, said the NNPC loan is fraudulent.
He said the loan was a gimmick to force the naira to appreciate at the parallel market, stating that such monetary policy was CBN's responsibility and not NNPC's.
He said Tinubu's administration detained the suspended CBN Governor, Godwin Emefiele, for taking $7.5 billion Forex loans from JP Morgan and Goldman Sachs to defend the naira.
"Now, Tinubu's administration claims to have done the same thing by forcing the NNPCL to take a loan of $3bn to defend the naira," he said.
Nigeria’s debt stock hits N82 trillion amid CBN's naira devaluation
Legit.ng reported that Nigeria’s public debt has risen to N82 trillion from N77 trillion before the Central Bank of Nigeria (CBN) exchange rate unification, announced on Wednesday, June 14, 2023.
According to a press release by the CBN, all exchange rate windows are collapsed into the Importers and Exporters (I&E) window, showing a merger of the multiple exchange rates.
The unification has seen the naira fall to N664 per dollar and has attracted severe consequences for the nation’s economy, including a spike in public debt.
Source: Legit.ng
