Amid N87tn debt, DMO says there is room for N1.7tn new external borrowing
- The DMO stated that Nigeria still has the capacity to borrow N1.7 trillion debt based on budgetary allocation
- DMO's DG explained that the country is not exploring the Eurobond now because it is not open to Africans yet
- She said budgetary deficit is the cause of debt in the country
Director General of the Debt Management Office (DMO), Patience Oniha, said there was budgetary approval authority to borrow N1.7 trillion in foreign debt.
She said this at the Capital Market Solicitors Association (CMSA) 's 2023 Annual Business Summit in Lagos.
This follows a report that Nigeria's total external debt increased from N49.8 trillion to N87.379 as of June 30, 2023.
Source: UGC
Under the administration of President Bola Tinubu, Nigeria has borrowed over $1.95 billion from the World Bank.
More room for borrowing
According to Oniha, the budget for this year contains space for a new foreign loan of roughly N1.7 trillion, or $2 billion when adjusted to official rates.
She clarified that the market has not been accessible to many African nations which delayed the issuance of Eurobonds.
Oniha said no African country has been able to issue Eurobonds for the entire year.
The DG noted that the avenue will be explored when the market is open and the rates are favourable.
Oniha highlighted that the Eurobond programme was launched to raise capital to boost foreign exchange reserves and lower domestic borrowing.
She said the initiative was also to stop the crowding-out effect.
She pointed out that Nigeria's debt has increased since it left the Paris Club and that the nation's budget deficit is the leading cause of the debt.
Nigeria Still Repaying World Bank Loan Borrowed Under IBB, 107 Others as Debt Stock Hits N87trn
Legit.ng earlier reported that Nigerian government is repaying about $14.12 billion in World Bank loans.
According to Punch, the amount is the funds disbursed on about 108 approved loans, data from the website of the World Bank shows.
The oldest loan being serviced was approved almost 40 years ago under General Ibrahim Babangida.
The most recent was approved in 2018 under the immediate past president, Muhammadu Buhari.
Source: Legit.ng
