By Elizabeth Adegbesan
Financial sector credit to the Nigerian government rose month-on-month (MoM) by 3.5 percent to N32.3 trillion in July 2023 from N31.2 trillion in previous month of June.
The Central Bank of Nigeria (CBN) disclosed this in its Money and Credit Statistics data for July, saying that credit to the private sector also rose during the period.
According to the data, credit to the private sector grew by 2.3 percent to N54 trillion in July from N52.8 trillion in June. This resulted in a net domestic credit MoM growth of 2.85 percent to N86.4 trillion in July from N84 trillion in June.
The Debt Management Office (DMO) put Nigeria’s total public debt at N49.85 trillion as at the end of the first quarter of 2023 (Q1’23), representing an increase of N3.60 trillion compared to N46.25 trillion recorded at the end of December 2022.
However, CBN in its monthly economic report for February 2023, noted that the Federal Government spent N408.5 billion on debt servicing during the period.
The International Monetary Fund, IMF, recently projected federal government external debt including that of the private sector will rise to $121.6 billion in 2023.
Also, the World Bank projected that debt servicing will gulp 123.4 per cent of the Federal Government’s revenue in 2023.
Recall that the Federal Government earmarked N6. 55 trillion for debt servicing in 2023, according to the Appropriation Bill passed by the National Assembly.
The sum of N8.32 trillion was for recurrent (non-debt) expenditure while N5.97 trillion was for capital expenditure for the year ending 31st of December 2023.
The budget deficit of N10.78 trillion will be funded through borrowing.