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- The Nigerian government, via the Central Bank of Nigeria (CBN), spent about $2.78 billion on debt servicing in 2024
- The amount is a 64% increase from the amount used in debt servicing in the same period last year
- CBN data shows a debt service increase of 46% in the first seven months of this year
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The Nigerian government has spent about $2.78 billion on debt-servicing in the first seven months of 2024.
The Central Bank of Nigeria’s (CBN) data on international payments shows that the figure is about 64% of the total $4.636 billion in official USD payments made between January and July 2024 by the bank on behalf of the federal government.
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Debt servicing rises by 46% in 2024
In the same period in 2023, Nigeria spent 46% of its total international payments servicing debts, meaning an increase of 39.13% in 2024.
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The rise suggests that Nigeria’s foreign debt servicing obligations have significantly grown, surpassing the increase in overall international payments.
The increase could be due to several factors, such as debt stock, higher interest rates on existing debts, or changes in payment schedules, leading to more debt servicing requirements.
Breakdown of debt servicing in 2024
According to reports, Nigeria’s total external debt servicing in January increased to $560.52 million, representing a staggering 399% rise from the $11.35 million recorded in 2023.
The amount constitutes 74% of the total international payments of $757.41 million in the same month.
A breakdown of the country’s debt servicing costs is $283.22 million, accounting for 67% of the $424.96 million monthly international payments.
There was a slight decline in debt servicing payments by 2 per cent from the $288.54 million paid in the same month of 2023,
In March, debt servicing costs declined to $276.17 million, 31% lower from the $400.47 million recorded in the same month last year, representing 65% of the total international payments of $424.71 million.
In April, CBN reportedly serviced debts with $215 million, representing 47% of the total $462.54 million in international payments last year.
April payment was the lowest amount observed in the year. However, it shows a 132% increase from the $92.85 million recorded in the same period last year.
May recorded a spike, with debt servicing surging to $854.37 million, an increase of 287% from $221.05 million in the same month of last year, showing a considerable rise in debt stock.
The month’s debt servicing highlights the highest expenditure in the same period, representing 69% of the $1.24 billion payments.
June recorded debt servicing of $50.82 million, 6% lower than the $54 million used in the same period in 2023.
July records the highest amount in debt servicing
July saw another spike in debt servicing figures, this time at $542.50 million, representing 78% of the $694.45 million total international payments.
Nigeria's debt servicing amounts escalated in the first seven months of this year to about $2.78 billion, a 19% increase from the $1.81 billion spent in the same period last year.
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Legit.ng earlier reported that data released by the Central Bank of Nigeria (CBN) shows the total amount of external debt servicing in 2023 from January to October.
During the ten months, the nation paid $3.07 billion in servicing its foreign debt. The amount represents an increase of $850.42 million or 38.31% over the $2.22 billion it spent during the same time in 2022.
A breakdown of the data showed that to service its external debt, the government spent $112.35 million in January, $288.54 million in February, and $400.47 million in March.
Source: Legit.ng
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