Nigeria’s external debt could reach $45.1 billion by the end of 2024, and the Federal Government intends to obtain further external finance, raising concerns about an impending debt catastrophe.
The country’s foreign debt stock grew by $780 million in the second quarter of 2024, from $42.12 billion in March to $42.9 billion by June 2024, according to a report released by the Debt Management Office (DMO).
A $2.2 billion external borrowing plan was approved by the Federal Executive Council (FEC) on Thursday as part of the Federal Government’s finance scheme for the 2024 Appropriations Act.
During a briefing following the FEC meeting, Finance Minister Wale Edun discussed the new borrowing plan, stating that it includes Eurobond and Sukuk issues, valued at $1.7 billion and $500 million, respectively.
Nigeria’s access to the global capital market, he continued, shows that President Bola Ahmed Tinubu’s economic reforms are accepted and supported. By the end of 2024, the nation’s external debt is expected to have grown to $45.1 billion with the $2.2 billion additional borrowing plan.
The borrowing intentions, however, coincide with the fact that, according to data from the Central Bank of Nigeria, Nigeria spent $3.58 billion in the first nine months of 2024, a 39.77 percent increase from the $2.56 billion spent in the same period in 2023, to service its foreign debt.
Remember how the DMO stated in October 2024 that by the end of June 2024, Nigeria’s entire debt stock had increased to N134.3 trillion?
Muda Yusuf, the director of the Centre for the Promotion of Private Enterprise (CPPE), responded to the growing debt profile by criticizing the mounting debt load and pointing to persistent infrastructure deficiencies and insufficient revenue capacity as the main issues.
