The Central Bank of Nigeria (CBN) has spent a total sum of $2.56 billion between January and September 2023 to service the federal government’s foreign debt obligations.
When compared to the debt servicing obligation of the FG in the previous year, this represents an 18% Year-on-Year (YoY) increase from $2.17 billion recorded in the same period in 2022.
Nigeria's economy has continually faced threats from debt servicing as evidenced in the high debt service to revenue ratio which stood at 183% in the first quarter of 2023.
During the period, debt service was ₦2.2 trillion compared to ₦1.6 trillion budgeted for in the first quarter of the year.
According to an analysis of the country's debt profile, Nigeria’s total public debt has been projected to hit (probably exceed) ₦118.37 trillion by the end of 2026.
Nigeria's total debt which stood at ₦87.38 trillion by June 2023 recorded an increase of 75.29% from ₦49.85 trillion reported at the end of the first quarter (Q1) of the year thus indicating a ₦37.53 trillion increase in total public debt.
Further details from the CBN data showed that the apex bank withdrew an average of $328 million on debt services and payments between 2011 and 2017.
By 2018, the amount had hit the $1.4 billion mark. The amount remained at the same level in 2019 as the CBN withdrew $1.34 billion as debt service and payment.
The amount paid for debt services dropped by 63% in 2021 to $2.13 billion from $5.77 billion recorded in 2020.
In 2022, Nigeria spent a total of $2.4 billion to service its external debt, which was a slight increase from the $2.11 billion spent in 2021.
The highest debt services and payments recorded by the CBN was paid in 2020 and recorded $5.77 billion, while a total of $242.8 million was the lowest in 2013.