The Debt Management Office has clarified that Nigeria’s debt-to-Gross Domestic Product ratio is within the specifications set by the World Bank and the International Monetary Fund for countries in Nigeria’s peer group.
This statement comes amid media reports suggesting that Nigeria’s debt-to-GDP ratio of 52 percent exceeds the prudential ceiling for similar countries.
In an interview with the News Agency of Nigeria on Tuesday in Abuja, the Director-General of the DMO, Patience Oniha, addressed these reports. Oniha explained that the prudential ceiling for countries in Nigeria’s peer group is actually 55 percent, not 40 percent as claimed in some reports.
Oniha emphasized the importance of improving revenue generation for achieving accelerated socio-economic development and ensuring debt sustainability. “We cannot discuss growth, development, or debt without giving due consideration to revenue. It is now imperative that we confront revenues and take decisive actions to further strengthen our revenue streams from all sources,” she stated.
She highlighted recent Federal Government policies aimed at enhancing revenue generation as positive steps towards reducing the country’s debt burden. Oniha also urged the Federal Government to prioritize fiscal retrenchment and assured that measures to attract foreign exchange inflows would bolster external reserves and support the naira exchange rate.
This clarification comes in the wake of the DMO’s recent announcement that Nigeria’s total debt stock rose to N121.67 trillion in March, up from N97.34 trillion in December 2023, reflecting an increase of N24.33 trillion. Oniha attributed the rise partly to exchange rate fluctuations and the securitization of N4.90 trillion as part of the N7.3 trillion Ways and Means Advances approved by the National Assembly.
She further clarified that the total debt stock includes the domestic and external debt of the 36 states and the Federal Capital Territory.
