FG Borrows N2.7 Trillion in 12 Months

• FG Borrows N2.7 Trillion in 12 Months

The total debt owed by the Federal Government, State Governments and the Federal Capital Territory Administration surged by N2.75 trillion between July 1, 2017 and June 30, 2018, according to the report published by the Debt Management Office.

The report made available in Abuja also showed Nigeria’s debt stood at N22.38 trillion ($73.21 billion) as of June 30, representing an increase of N2.75 trillion or 14 percent from the N19.63 trillion reported on June 30, 2017.

Debt Management Office attributed the increase in debt profile to the US$2.5 billion Eurobond issued by the Federal Government in February.

Patience Oniha, the Director General of the DMO, said on Tuesday that the agency has been able to raise N410 billion from the local market to finance capital projects in 2018 budget. According to her, the money was part of the N793 billion stipulated, in the 2018 Appropriation Act, to be borrowed from the domestic market within the year.

The appropriation act approved external borrowing of N850 billion.

Responding to questions from journalists, Oniha dismissed the notion of excessive borrowing since the current administration came to power in 2015, explaining that the administration only borrowed after thorough examinations and approvals from lawmakers.

The Director-General further stated that “If government didn’t borrow so much in the last three years, it wouldn’t have been able to function as a government.”

“The huge borrowing became necessary following the fall in revenue from the fall in the price of crude and the attendant devaluation of the naira from the use of the external reserve to defend the national currency.”

Prior to present administration, Nigeria’s total debt was N12.12 trillion as of May 29, 2015.

In a separate but related report, Nigeria attracted $27.9 billion in three years.