Debt servicing consumed 47 per cent of the Federal Government’s total expenditure in the first nine months of 2024, The PUNCH reports.
An analysis of data from the Central Bank of Nigeria’s latest quarterly statistics bulletin highlights the growing burden of debt repayment obligations and its implications for Nigeria’s fiscal sustainability.
In the first nine months of 2024, the Federal Government spent N8.94tn on debt servicing, a sharp increase of 56.8 per cent from N5.69tn in the corresponding period of 2023.
The debt costs accounted for nearly half of the N18.97tn total expenditure for the period, compared to 42 per cent of the N13.57tn spent in 2023.
The rising debt servicing ratio reflects Nigeria’s increasing dependence on borrowing to fund its budgetary operations, particularly as fiscal deficits continue to widen.
The debt-to-revenue ratio further underlines the severity of the situation. In 2023, the Federal Government’s retained revenue of N4.32tn meant that debt servicing accounted for 132 per cent of revenue during the period.
This figure worsened in 2024, when debt servicing consumed 147 percent of the N6.08tn retained revenue.
