FG Spends $1.82bn On External Debt Servicing In 9 Months

Nigeria’s federal government spent a sum of $1.82 billion on external debt servicing in the first nine months of the year, ended September 30, 2021.

This is according to the quarterly debt report by the Debt Management Office (DMO).

The figure represents a 43.9% increase from the $1.27 billion spent in the corresponding period of 2020.

According to the report, the country used $520.78 million to service external debt in the third quarter of 2021, representing a 74.2% increase compared to $298.9 million recorded in the preceding quarter of the year.

Similarly, domestic debt servicing rose significantly by 150.5% from N322.75 billion recorded in Q2 2021 to N808.49 billion in Q3 2021.

This takes the year-to-date domestic debt service to N1.74 trillion from N1.53 trillion recorded in the same period of 2020.

The increase in debt service comes on the back of the significant jump in the country’s debt profile. Nigeria’s external debt rose to $37.96 billion as of Q3 2021, moving from $33.47 billion recorded in the previous quarter.

The increase in the country’s external debt was driven by the 4 billion Eurobond raised from the international debt market to boost the country’s external reserve above $40 billion.

It would be recalled that Nigeria raised a sum of $4 billion in Eurobond in September, a capital raise which was dubbed one of the biggest financial trades on the African continent after the order book peaked at $12.2 billion, which enabled the federal government to raise an additional $1 billion more than the intended $3 billion capital raise.

On the other hand, domestic debts also recorded an uptick as federal government domestic debt stock rose to $44.44 billion, while state domestic debts increased to $10.23 billion.

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