The presidency has clarified Nigeria’s debt situation under President Bola Tinubu’s administration, countering reports of an increase in the nation’s debt stock.
According to the presidency, Nigeria’s debt stock actually decreased by 15% in dollar terms during the first quarter of 2024, despite claims to the contrary.
This clarification was made on August 31 by Dada Olusegun, the Special Assistant to President Tinubu on Social Media, in response to a report by StatiSense. The report had outlined Nigeria’s debt profile under various presidents, from Shehu Shagari to the current administration.
Olusegun explained that the apparent rise in public debt under the Tinubu administration is primarily due to economic factors rather than new borrowing. He emphasized that the government is actively working to reduce the nation’s debt burden and remains committed to repaying its obligations.
In a post on his X account titled “Debunking the Myth: Nigeria’s External Debt Under President Bola Tinubu,” Olusegun highlighted key points:
- Contrary to reports, Nigeria’s total debt stock decreased by 15% in dollar terms in Q1 2024.
- The increase in public debt is largely due to economic factors, including the depreciation of the naira (from N899.39/$ to N1,330.26/$), changes in interest rates, and the securitization of Ways and Means advances.
- The current administration inherited a legacy of N22.7 trillion in outstanding Ways and Means advances, which are now being audited and securitized.
- The remaining Ways and Means deficit is N3.4 trillion, partially offset by surpluses from revenue-generating agencies.
- Nigeria’s (federal government only) external debt stands at $42 billion, with $20.82 billion owed to multilateral creditors and $5 billion owed to China.
- Economic reforms introduced by the Tinubu administration have affected foreign exchange and interest rates, contributing to the public debt increase.
- Despite these challenges, the government maintains a strong capacity to repay its debts, supported by a revamped financial system.
The presidency’s detailed explanation aimed to provide a clearer understanding of the factors influencing Nigeria’s debt and to reassure the public about the government’s commitment to responsible economic management.
