Govt’s Local Debt Hits N10.8tn, Owes Foreign Creditors $11.5bn

• Govt’s Local Debt Hits N10.8tn, Owes Foreign Creditors $11.5bn

As of September 30, 2016, the Federal Government’s indebtedness to local creditors stood at N10.8tn, while external debt was $11.5bn.

The Minister of State for Budget and National Planning, Zaynab Ahmed, disclosed this at the presentation of the budget implementation and performance monitoring report for the third quarter of 2016, which was held at the old Banquet Hall of the Presidential Villa, Abuja on Tuesday.

Ahmed said the N10.8tn domestic debt component represented an increase of N238.89bn or 2.25 per cent over the second quarter figure.

She added that the third quarter debt figure was also N2.23tn (25.93 per cent) above the N8.6tn recorded in the same period of 2015.

The minister said, “The external debts, which were mostly low interest funds from multilateral financial institutions, stood at $11.58bn, representing an increase of $320.70m (or 2.85 per cent) from external debt stock in the second quarter of 2016 and an increase of $965.24m (or 9.09 per cent) over the $10.617bn documented in the third quarter of 2015.

“The increase in the external debt stock in the third quarter of 2016 was due largely to the rise in non-Paris Club bilateral debts’ drawdown.”

Ahmed also said the Federal Government spent N1.1trn on debt servicing between January and September 2016.

While N1.044tn was expended on local debt servicing, N50.22bn was spent on external debt.

According to the minister, the amount spent on the servicing of both debt components was more than what was proposed in the budget.

Ahmed said, “A total of N980.55bn was proposed for domestic debt servicing within the period but N1.044tn was actually used for the servicing of the debts.

“This means a difference of N63.45bn (or 6.47 per cent) above the three quarters’ of the year projection. Similarly, the sum of N40.86bn was proposed for the servicing of external debt during the period, while the actual external debt service payment amounted to N50.22bn, thereby, indicating a difference of N9.36bn (or 22.91 per cent) above budgeted estimate for the time period.

“These figures are also expected to be reconciled at the end of the year.”

She also disclosed that government revenues dropped by 60 per cent on account of the uncertainties in the global oil market that were further compounded by crude oil theft, illegal bunkering and militancy in the Niger Delta region.

The minister explained that net oil receipt dropped by 66.6 per cent to N201.37bn in the third quarter of 2016 as against N603.53bn in same period of 2015.