Market News

From Chinwendu Obienyi and Adanna Nnamani, Abuja

Nigeria’s total public debt surged to N142.3 trillion as of September 30, 2024, reflecting an increase of 5.97 per cent (N8.02 trillion) compared to N134.3 trillion recorded in June 2024.

The rise, according to the latest data from the Debt Management Office (DMO), highlights the growing strain on the nation’s finances, fueled by escalating domestic borrowing and the adverse effects of exchange rate depreciation on external debt.

In dollar terms, it declined by 5.34 per cent, from $48.45 billion in June to $45.87 billion in September.

However, in naira terms, domestic debt rose by 3.10 per cent, from N71.22 trillion to N73.43 trillion. The Federal Government accounted for the bulk of this increase, with its domestic debt rising from N66.96 trillion to N69.22 trillion during the period under review.

In contrast, the domestic debt of states and the Federal Capital Territory (FCT) experienced a slight decline, falling from N4.27 trillion to N4.21 trillion.

The Federal Government’s bond issuance remained the largest component of domestic debt, growing by 4.47% to N54.65 trillion in September, up from N52.32 trillion in June.

An analysis of Nigeria’s external debt stock of $43.03 billion in September 2024 reveals a relatively stable debt profile, with only minor adjustments observed across multilateral and bilateral obligations.

Multilateral debt saw a slight increase of 0.67%, rising to $21.77 billion, which continues to represent 50.60% of total external debt.

Bilateral loans, on the other hand, saw a small decline of 1.33%, falling from $5.89 billion to $5.81 billion.

Loans from China, Nigeria’s largest bilateral lender, decreased by $99.98 million, although obligations to France and Germany remained stable.

Commercial loans, primarily in the form of Eurobonds, remained unchanged at $15.12 billion, making up 35.14% of the total external debt.

According to experts, Nigeria’s rising public debt, both domestic and external, is a clear indication of the growing pressure on the nation’s fiscal framework.

Moving forward, the government’s strategy will need to address these challenges and ensure that the nation’s borrowing is both sustainable and aligned with long-term economic growth objectives.