Nigeria now third-largest debtor – World Bank

Nigeria’s global image suffered a new low as the World Bank’s June 30 financial statement declared the country as the third-largest debtor to the Bank’s International Development Association (IDA).

The Debt Office stated that total domestic debt was N65.65 trillion ($46.29 billion), while total external debt was N56.02 trillion ($42.12 billion).

According to the financial statement, Nigeria pushed India to the fourth spot with $15.9 billion after the country reduced its IDA exposure from $17.9 billion in 2023. Ethiopia, Kenya, and Vietnam followed with $12.2 billion, $12.0 billion, and $12.0 billion, respectively.

The three countries at the bottom of the list are Tanzania with $11.7 billion, Ghana with $6.7 billion, and Uganda with $4.8 billion.
Nigeria’s exposure to IDA rose to $16.5 billion as of June 30, an increase of $2.2 billion or 14.4% over the $14.3 billion recorded at the end of 2023.

IDA is a key arm of the World Bank that provides concessional loans and grants to the world’s poorest countries.

The loans are designed to promote economic growth, reduce inequalities, and improve living conditions in developing nations, and are characterised by low-interest rates and long tenors.

At the top of the IDA debt list is Bangladesh with $20.5 billion, followed by Pakistan with $17.5 billion exposure.

“As of June 30, 2024, the ten countries with the highest exposures accounted for 63% of IDA’s total exposure. Monitoring these exposures relative to the SBL requires consideration of the repayment profiles of existing loans, as well as disbursement profiles and projected new loans and guarantees,” the World Bank said.

Recall that the Debt Management Office (DMO) reported that Nigeria’s total public debt increased to N121.67 trillion in the first quarter of 2024, compared to N97 trillion recorded in December 2023.

According to the DMO, the increase was primarily due to new domestic borrowing by the federal government to partly fund the deficit in the 2024 budget, as well as disbursements by multilateral and bilateral lenders.

The Debt Office stated that total domestic debt was N65.65 trillion ($46.29 billion), while total external debt was N56.02 trillion ($42.12 billion).

It said, “It is, therefore, important to remind you that it is our responsibility to grapple with the apparent challenges that have befallen our nation and its continued use to beggar and humiliate our people and workers.

“You must not, therefore, allow yourself to become an instrument for the pauperization of the workers that you lead.

“You must not allow this process to be turned into a tool to deprive and cheat already suffering workers out of the benefits that may accrue to them. Congress will severely sanction any state council that colludes with employers, whether public or private, to cheat workers out of their benefits. I believe that the same mindset that was in us at the national level will be in all of you here, so that we will have a successful implementation round. As we head to the negotiation table, we must begin to organise and mobilise now. We must remain vigilant, informed, and united. This workshop is an essential step in that process.”