DMO Says Coronavirus to Disrupt Debt Plans

• DMO Says Coronavirus to Disrupt Debt Plans

The Debt Management Office said the fast-spreading coronavirus will disrupt Federal Government’s plans on debt.

Patience Oniha, the Director-General, DMO, made the statement while speaking at a public lecture titled ‘Public debt in Nigeria: Trend, Sustainable and Management,’ organised by the National Institute for Legislative and Democratic Studies.

She said Nigeria’s total debt rose from $17.35 billion in 2006 to $85.4 billion (N26.2 trillion) as of September 30, 2019. This, she said was not the issue given its ratio to the GDP, however, she said weak revenue generation amid slowing global growth could hurt the Federal Government’s ability to meet financial obligations in 2020.

The director put the nation’s total domestic debts at around N18 trillion or $58.4 billion, which is about 68.45 percent of the total public debts.

Therefore, it is important for the nation to expand revenue generation to curb the effect of global happenings.

She said, “The total public debt has indeed been growing. The debt includes external and domestic debts of the Federal Government, state governments and the FCT; and the debt has accumulated over many years.

“Whilst Nigeria’s debt is sustainable, recent developments in the global environment induced by COVID 19 already suggest a less-than-favourable economic outlook with implications for Nigeria.

“Irrespective of COVID-19, the drive towards revenue generation should remain a priority for Nigeria, to finance development and strengthen development sustainability.”

Oniha also said, “Concerns have been expressed about the growth in Nigeria’s debt stock since the exit from the Paris and London Club of Creditors. It is true that the public debt stock has grown from $17,349.69m in 2006 to $85,390.82m as of September 30, 2019.

“However, it must be recognised that the current debt stock is the result of cumulative borrowing by successive governments to finance budget deficits and various infrastructure projects.”