Nigeria’s Debt Servicing To Hit N13.5trn

The federal government debt service burden will hit N13.5trn if the N3.1trn allocated for the item in the 2021 budget proposal is added to funds already expended on same by this administration.

The proposal was contained in the details of the N12.658trn budget proposal for 2021 which were unveiled on Tuesday.

The breakdown shows that the country spent N943bn for debt servicing in 2015, N1.36trn in 2016, and N1.66trn in 2017. The analysis also showed that in 2018, the federal government spent N2.23trn on debt servicing while in 2019, it spent N2.14trn.

In 2020, the government planned some N2. 5tr on debt servicing and it estimates to spend N3.1trn on the same item line next year.

Daily Trust reports that the debt service is both for domestic and foreign debts.

Economists have insisted that the continuous borrowing by Nigeria was not good for the economy, going by the huge amount spent on servicing those debts.

Also, an official at the Ministry of Power has expressed worry that the delay in accessing the World Bank loan of $1.5bn (about N571.5bn) for Nigeria’s power sector in August may worsen the electricity crisis.

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