Buhari charges RMARC to mobilise funds from non-oil sources
The Federal Government spent a total of N609,134,926,039.42 to service debt obligations between January and March 2020, latest debt service report posted last night by Debt Management Office (DMO) on its website showed. A breakdown of the debt service revealed interest on NTBs stood at N111.605 billion, interest on FGN Bonds, N488.935 billion, FGN Savings Bonds debt servicing took N392.794 billion, while Rentals amounted to N8.201 billion during the period.
On a month-by-month basis, January debt servicing was N251.352 billion, February interests stood at N158.123 billion, while March debt servicing figure was N199.658 billion. The DMO had earlier released the nation’s total public debt stock of N28.628 trillion, as at March 31, 2020. It consisted of domestic debt of N18.641 trillion ($51.637 billion) and external debt of N9.987 trillion ($27.665 billion)
The 36 states and the Federal Capital Territory (FCT) owed a total of N4.106 trillion as at March 31, 2020. Lagos State topped the table with N444.227 billion, followed by Rivers, which owed N266.936 billion, Akwa Ibom was third with N240.030 billion and Delta N230.752 billion. Cross River owed N165.919 billion, Imo, N163.995 billion, Bayelsa, N154.951 billion, Ogun, N143.530 billion, Osun, N137.309 billion, N130.732 billion and Kogi, N128.917 billion. States with the least debts were: Yobe N29.294 billion, Anambra, N33.917 billion, Jigawa, N36.020 billion, Ebonyi N42.418 billion and Sokoto, N47.745 billion. “This domestic debt is generated from the sign-off submission received from 36 states of the federation and FCT,” DMO clarified.
DMO, last week, clarified that the total borrowing by Nigeria government from China was $3.121 billion (N1,126.68 billion at USD/ N361), as at March 31. This amount, it explained in a statement, was only 3.94 per cent of Nigeria’s total public debt of $79.303 billion (N28,628.49 billion at USD/N361) at the end of the first quarter. Similarly, external sources of funds, loans from China, the Office said, accounted for 11.28 per cent as at the time under review and that China was not a major source of funding of the Federal Government.
The DMO said that the loans were concessionary, with generous low-interest terms and that there was nothing to worry about, with regard to Chinese loans to Nigeria. The loans were taken on interest rates of 2.50 per cent per annum, tenor of 20 years and grace period (Moratorium) of seven years.
“These terms are compliant with the provisions of Section 41 (1a) of the Fiscal Responsibility Act, 2007. In addition, the low interest rate reduces the Interest Cost to Government, while the long tenor enables the repayment of the principal sum of the loans over many years. “These two benefits make the provisions for debt service in the annual budget lower than they would otherwise have been if the loans were on commercial terms,” it said. According to the DMO, the $3.121 billion loans are project-tied.
“They included Nigerian Railway Modernization Project (Idu-Kaduna section), Abuja Light Rail Project, Nigerian Four Airport Terminals Expansion Project 2 (Abuja, Kano, Lagos and Port Harcourt), Nigerian Railway Modernization Project (Lagos-Ibadan section) and Rehabilitation and Upgrading of Abuja- Keffi-Makurdi Road Project,” DMO added. It stated that the procedure for obtaining the loans met laid down criteria and was fully transparent.