Despite Rising Debt Profile, President Buhari Seeks New N2.342T External Loan

President Muhammadu Buhari, on Tuesday, urged the Senate to approve a new external loan of N2,343,387,942,848.00, about $6.183billion, for the Federal Government to finance the 2021 budget deficit.

Senate President Ahmad Lawan read Buhari’s letter of request on the floor of the Senate at plenary.

Last Month, Investorsking recalled that there was a controversy when Edo State Governor, Godwin Obaseki had raised concerns over the financial trouble Nigeria might find herself due to the continuous rising debt profile.

In a recent report carried out by PWC, it was reported that:

“Actual debt servicing cost in 2020 stood at N3.27 trillion and represented about 10 percent over the budgeted amount of N2.95 trillion. This puts the debt-to-revenue ratio at approximately 83 percent, nearly double the 46 percent that was budgeted.

“This implies that about N83 out of every N100 the FG earned was used to settle interest payments for outstanding domestic and foreign debts within the reference period. In 2021, the FG plans to spend N3.32 trillion to service its outstanding debt. This is slightly higher than the N2.95 trillion budgeted in 2020”.

According to DMO Nigeria’s total public debt as at December 31, 2020, was N32.915 Trillion.