FRESH LOANS FROM WORLD BANK, IDB OTHERS SET TO TAKE NIGERIA’S EXTERNAL DEBTS TO 31.7BIL NAIRA

 

OKECHUKWU NNODIM

The Nigerian government is yet to end it’s borrowing spree. Borrowing to construct rails linking other countries, borrowing to take virtually every developmental efforts without any qualms has been the hallmark of the BUHARI regime. Nigerians whose voices matter have cried their voices hoarse but the incumbent government seems hell bent on taking more and more loans.

 

Fresh loan disbursements expected from the World Bank, African Development Bank and Islamic Development Bank may raise Nigeria’s total public debt stock to N31.699tn in coming months.

Nigeria currently expects about $1.844bn (N699.1bn at N379/$ official exchange rate) from the three financial institutions, Sunday PUNCH gathered from the Debt Management Office in Abuja.

On September 10, 2020, Sunday PUNCH reported that Nigeria’s public debt stock, as released by the DMO, rose to a total of N31.01tn at the end of June, indicating that in the last five years under the President, Major General Muhammadu Buhari (retd), the country’s debt rose by N18.89tn.

In the report, the DMO revealed that the country was still expecting additional disbursements from international financial institutions, a development that would further increase Nigeria’s debt.

The debt office had said, “The DMO expects the public debt stock to grow as the balance of the new domestic borrowing is raised and expected disbursements are made by the World Bank, African Development Bank and the Islamic Development Bank which were arranged to finance the 2020 budget.”

When contacted by our correspondent on the additional disbursements being expected, the DMO, in an emailed response, explained that Nigeria was currently expecting a loan of $1.5bn (N568.5bn at N379/$ official exchange rate) from the World Bank.

It also stated that a balance of $211.5m (N80.16bn) was being expected from the AfDB before the end of this year.

It was gathered that that the $211.5m balance was part of the $500m facility which Nigeria applied for from the bank, as an initial $288.5m had been approved by the AfDB.

Our correspondent further learnt that Nigeria also applied for $133m (N50.41bn) from the Islamic Development Bank as budget support facility needed to address challenges posed by the COVID-19 pandemic.

Conversations on the loan request are currently ongoing.

In the response from the DMO, the debt office said, “Nigeria applied for a facility in the sum of $1.5bn from the World Bank. The request is presently being appraised by the World Bank.

“Nigeria applied for a facility of $500m from the African Development Bank. An initial sum of $288.5m has been approved by the AfDB, while the balance is expected to be approved before the end of the year.

It added, “Nigeria applied to the Islamic Development Bank for $113m as Budget Support Facility for Nigeria’s response to the challenges posed by COVID-19. Discussions are ongoing on the request.”

Based on the above, it therefore implies that the country’s total public debt could rise by an additional N699.1bn in coming months once the disbursements are made.

Nigeria’s total public debt stock includes the debt stock of the Federal Government, the 36 states and the Federal Capital Territory.

However, most of the debts were contracted by the Federal Government.

 

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