Nigeria’s external debt is expected to reach $45.1 billion by the end of 2024, raising concerns about a potential debt crisis.
- The Federal Government is seeking additional external financing to tackle ongoing financial challenges.
- According to the Debt Management Office (DMO), Nigeria’s external debt stock rose by $780 million in Q2 2024, increasing from $42.12 billion in March to $42.9 billion in June.
- This growing debt underscores the difficulties the government faces in managing its financial obligations.
- In response to the mounting debt, the Federal Executive Council has approved a $2.2 billion external borrowing plan linked to the 2024 Appropriation Act.
- Finance Minister Wale Edun explained that this initiative includes $1.7 billion in Eurobond and $500 million in Sukuk offerings.
- The government remains optimistic about international confidence in its economic reforms, but the new borrowing could push external debt to $45.1 billion by year-end.
- Rising debt levels pose significant risks, with Nigeria spending $3.58 billion on debt servicing in the first nine months of 2024, a 39.77% increase from the same period in 2023.
- This mounting debt servicing burden further strains the country’s finances.
- By October 2024, the DMO reported that Nigeria’s total debt stock had reached N134.3 trillion as of June 2024, according to economic experts like Muda Yusuf of the Center for the Promotion of Private Enterprise (CPPE).
