Nigeria’s debt servicing expenses reached N6.04tn in the first half of 2024, marking a sharp increase of 68.8 per cent from the N3.58tn recorded during the same period in 2023, the latest data from the Central Bank of Nigeria showed.
This implies that the amount spent by the Federal Government in servicing debt during the review period is about three times what it spent on personnel costs.
This sharp rise in debt service obligations, likely driven by naira devaluation for foreign debt repayments, reflects the growing burden on the Federal Government as debt repayment consumes a significant portion of its financial resources.
In contrast, personnel costs totalled N2.32tn in H1 2024, a 17.6 per cent rise from N1.97tn spent in H1 2023.
This expenditure pattern indicates that debt servicing is now almost triple the government’s wage bill, raising concerns about the sustainability of the country’s debt profile and the increasing pressure on public finances.
Despite the rising cost of living in the country, the total amount spent on salaries in the first six months of 2024 only increased marginally. The PUNCH observed that in H1 2024, about half of the Federal Government’s total expenditures were on debt servicing.
