Nigeria’s foreign debt may hit $11.6 billion by 2027

Between 2017 and 2026, Nigeria’s foreign debt profile will have risen to $11.62 billion, the Debt Management Office says.

This includes some debts that will be due for redemption as well as interests that would have accumulated and redeemed on an annual basis.

In 2018, 2021 and 2023 Nigeria will have to pay more than $1 billion each year due to the fact that some Eurobonds issued by the Federal Government will be due for redemption then.

In 2018, the country will be parting with $1.19 billion, comprising of principal redemption of $716.09 million and interest payment of $475.8 million.

In 2021, Nigeria will part with $1.58 billion, made up of $1.12 billion principal redemption and $440.59 million interest payment.

By 2023, the country will have to part with $1.69bn.

“Increased debt service payments would be made in 2018, 2021 and 2023, amounting to $1,193.04m; $1,584.54m; and $1,694.85m, respectively, when the debut 6.75 per cent Jan 2021 $500m 10-year Eurobond issued in 2011 and the $1bn dual-tranche Eurobonds – 5.125 per cent July 2018 $500m five-year and July 2023 $500m 10-year issued in 2013 would be due for redemption,” the DMO said.

This year, Nigeria will have to part with a total of $668.83 million, comprising of $144.4 million in principal redemption and $524.43 million in interest payment.

In 2019, the total debt to be paid will amount to $781.13 million; in 2020, $983.01 million; and in 2022, $1.18 billion.

In 2024, 2025 and 2026, the total foreign debt to be paid will be $1.18 billion; $1.18 billion and $1.17 billion respectively.

Patience Oniha, Director-General of the Debt Management Office

The DMO said the actual payment in each of the years will likely be higher, since Nigeria is still making fresh commitments in terms of securing foreign loans.

In October 2016, the DMO said that the maximum amount of money the country can comfortably borrow in 2017 is $22.08 billion, and advised the federal government against excessive borrowing.



    But less than one month after, President Muhammadu Buhari wrote a letter to the Senate requesting for leave to borrow about $30 billion with which to execute key infrastructural projects across the country between 2016 and 2018. The request was rejected by the lawmakers at the time but the executive arm of government said it will re-send the request.

    However, in July this year, Anthony Ayine, the Auditor-General of the Federation said there is nothing wrong with Nigeria’s current rate of borrowing, since it is still within the minimum international benchmark.

    “Borrowing as a concept is not wrong; it is utilisation of the borrowed funds that is the critical aspect that people should be concerned with,” Ayine said.

    “If you are borrowing to address infrastructural problems like the present government is doing, if you are not borrowing for consumption, I don’t see anything wrong with the borrowing.”

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