See the Nigerian states with the highest external debts as FG's debt level rises

• Information from the Debt Management (DMO) Office says Nigeria’s external debt has hit record levels at $42 billion as of June 2024
• The DMO data shows that in the 36 states, including the FCT, 11% of Nigeria’s external debt stock
• DMO said that Lagos and Kanuna are the states with the highest external debts at $1.2 billion and $640.99 million respectively

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

Nigeria’s external debt is now $42 billion as of June 2024. 

Data from the Debt Management Office (DMO) shows that the 36 states, including the Federal Capital Territory, account for 11% of the loans, at $4.89 billion, and the federal government’s debt is $38 billion.

The country’s multilateral debt is $17.13 billion, while bilateral debt, including those from China EXIM Bank, Jika, KWF, IsDB, and AFD, is $5.49 billion.

President Bola Tinubu's government increases Nigeria's external debt to $42 billion Credit: State House
Source: Getty Images

States with high domestic and external debt

About $15.12 billion of the debts are commercial Eurobonds and diaspora bonds.

Data shows that as of March 2024, Nigeria’s external debt stood at $42.12 billion, with Lagos state leading other states with $1.2 billion, while Kaduna comes next with $640.99 million. The state with the most external debt is Edo, with $380.97 million.

However, the total domestic debt owed by the 36 states and FCT has hit N4.27 trillion, with Lagos state topping the chat with N885.99 billion.

Rivers follows with N389.2 billion, while Delta is third with N304.54 billion.

The states with the least domestic debt

Jigawa owes the least domestic debt at N1.82 billion. Ondo owes N15.1 billion in domestic debt, while Kebbi recorded N15.46 billion in domestic debt.

Jigawa’s figures indicate that its debt was slashed by N254.97 million from N2.1 billion as of March 2024 to N1.82 billion recorded at the end of June.

Ondo continued the trend with a decreased domestic debt stock at N1.3 billion to N15.1 billion from N16.4 billion in March.

The decline in Ondo’s debt level is the same as Kebbi, which reduced its debt stock from N17.06 billion to N15.46 billion, a drop of N1.6 billion.

Nigeria’s new domestic debt level

Conversely, Nigeria's total domestic debt stood at N4.07 trillion, with the states increasing their borrowing by N198.96 billion, representing about a five per cent rise in three months.

The DMO data shows that Lagos owed about N929.41 billion in March, increasing its debt stock by N43.42 billion in three months.

Rivers experienced a similar trend, with increased debt stock from N232.58 billion to N389.2 billion.

FAAC allocations could not tame debts

Guardian reports that in March 2024, the Federal Account Allocation Committee (FAAC) shared N1.12 trillion to the three levels of government, with the federal government getting N345.89 billion, states N389.69 billion, and N288.69 billion shared by the local governments.

Oil-producing states received about N90.124 billion from the FAAC funds.

The 36 states kept increasing their debt levels despite FAAC allocations.

However, Delta State was an exemption between March and June as it reduced its debt profile by nine per cent from N334.9 billion to N304.64 billion as of June 2024.

Taraba state witnessed the highest debt increases, adding N52.64 billion to its debt stock from N32.64 billion in March to N84.72 billion at the end of June 2024.

The high borrowing state was Niger, with N60.22 billion added to its N86.07 billion recorded in March to bring its total debt stock to N146.29 billion.

Other states include Bauchi, whose debt levels rose from N108.39 billion to N147.23 billion.

FG settles necessary debt with a domestic creditor

Legit.ng earlier reported that the Nigerian government allocated about N4.83 trillion from the earnings of Nigerian Treasury Bills (NTBs) and Bonds issued in 2024 to settle the Ways and Means advances from the Central Bank of Nigeria (CBN).

The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said this during his presentation at the Lagos Business School Breakfast Club.

In 2023, the Nigerian government obtained about N2.94 trillion from the apex bank via the Ways and Means advances to service domestic debts.

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Source: Legit.ng