By Philip Clement
The Debt Management Office (DMO), has announced that the total public debt stocks of Nigeria is now N31.009 trillion as at June 31, 2020, representing 8.3 per cent rise from N28.628 trillion in March 2020.
The DMO in a report said the figure comprised the debt stock of the federal government, the 36 state governments and the Federal Capital Territory (FCT).
The DMO explained that “The increase in the Debt Stock by N2.381 trillion or $6.593 billion was accounted for by the USD3.36 billion budget support loan from the International Monetary Fund, New Domestic Borrowing to finance the Revised 2020 Appropriation Act, including the issuance of the N162.557 Billion Sukuk, and Promissory Notes issued to settle Claims of Exporters.”
The DMO also said that the figure could rise further when the balance of the new borrowing is raised for the implementation of the current budget.
It stated: “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.
“The 2020 Appropriation Act had to be revised in the face of the adverse and the severe impact of COVID-19 on Government’s Revenues and increased expenditure needs on health and economic stimulus amongst others.
“Additional Promissory Notes are expected to be issued in the course of the year, this, and new borrowings by State Governments are also expected to increase the Public Debt Stock.”
It would be recalled that the rising debt service of the federal government in the 2020 budget surpassed capital Expenditure, a situation which has sparked public condemnation.
Experts believe that if the country keeps borrowing, it will be difficult for any meaningful development to take place.