Nigeria’s total debt rose to N35.5 trillion at the end of June 2021, the Debt Management Office has said.
The new figure, it stated, was 7.75 per cent higher than the N32.9 trillion recorded at the close of last year.
Director-General of the DMO, Patience Oniha, said on Wednesday that the external debt accounted for N13.7 trillion or 38.7 per cent while approximately N21.8 trillion was sourced from the local market.
She explained that 83.07 per cent of the total debt was held by the Federal Government while the 36 states and the Federal Capital Territory’s borrowings accounted for 16.93 per cent.
The percentage of the FG’s share of the national debt had increased from 81.94 per cent as at December 2020.
Minister of Finance, Budget and National Planning, Zainab Ahmed, had disclosed at a session organised by the African Development Bank that debts of some states were not captured in the figures regarded as national debts.
Oniha said the amount remained within fiscally accepted bound except that not much is done to shore up poor revenue.
She explained that China accounted for about 10 per cent of the external debt (which amounts to approximately N1.37 trillion), while the multilateral organisations had the largest share of 54.9 per cent.
Oniha, in a virtual media chat on Wednesday, said the country risked the debt sustainability issue if it failed to grow the current low revenue profile, which places Nigeria in the poorest category among its peers.
She said, “We should focus on revenue. The good thing about it is that the Minister of Finance, Budget and National Planning has started a programme aimed at growing the revenue profile.
“We must discipline ourselves to follow through to grow our revenue. If we continue to borrow and do nothing about growing our revenue base as other countries have done, we may have a debt sustainability challenge.”
Comparing the tax to gross domestic product of 11 countries, the DG said Nigeria as of 2019 was one the nations with the least ratio.
The selected countries are the United States, United Kingdom, Brazil, South Africa, Kenya and Mexico. Others included Canada, Morocco, Ghana and Angola.
While South Africa had the highest tax to GDP of 26.7 per cent, Nigeria sat at the bottom with 5.68 per cent. Angola, which came after Nigeria from the bottom, recorded 9.4 per cent tax to GDP.
Oniha said it was important to interrogate the reasons the country’s huge GDP has not translated to revenue, and that it was time the authorities aggressively pursued income-yielding policies.
She said Nigeria’s debt to GDP remained considerably low at 21.92 per cent, up from 21.61 per cent last year. She, however, said it could increase to 35 per cent when the ways and means facility (WMF), that is, overdrafts with the Central Bank of Nigeria (CBN), is added to the debt stock.
On the current value of the WMF, the DG said she could only give information on the status at the beginning of the year, when it was estimated at N10 trillion, suggesting that the figure could be higher.
She admitted that the government had overreached the limit set by the CBN Act, stressing that the government was compelled to do so owing to the revenue shortfall.
“We are currently working at converting it to a tenor facility. This is because overdrafts should be cleared when they are due,” the DMO boss started.
Abuja-Kaduna train resumes operation Saturday – NRC
Barely 24 hours after suspending the Abuja-Kaduna trains for safety reasons, the Nigerian Railway Corporation says the services will resume Saturday October 23.
The suspension followed an explosion attack by hoodlums on the Abuja-Kaduna rail track Wednesday evening, which the corporation said affected the locomotive tank of a Kaduna-bound train.
Although there have been conflicting accounts of the attack with some attributing it to bandit or terrorist attack, the Managing Director of the corporation said in an interview on Friday night that the NRC team of engineers and technicians had fixed the problem and was certified that the train service could resume on the route after carrying out extensive an inspection of the line.
The NRC also said in a statement issued Friday evening that the Abuja-Kaduna Train Services (AKTS) would “resume tomorrow, Saturday, 23rd October, 2021 as follows: From IDU, Abuja (AK3) at 0950am. From Rigasa, Kaduna (KA4) at 10.35am.”
The statement read in part, “The board and management of the Nigerian railway corporation (NRC) hereby inform the general public, particularly our valued passengers that Abuja-Kaduna Train Services (AKTS) resume tomorrow, Saturday, 23rd October, 2021 as follows: From IDU, Abuja (AK3) at 0950am. From Rigasa, Kaduna (KA4) at 10.35am. Subsequent train services continue.
“The NRC once again sincerely apologises for the inconvenience.”
Motorists, travellers stranded as Delta bridge collapses
There was confusion in part of Delta State on Friday following the collapse of the Umutu Bridge in the Ukwuani Local Government Area of the state, leaving several motorists and travellers on the Agbor-Abraka-Eku road stranded.
The incident reportedly occurred in the early hours of the day, adding that the aged long bridge gave way as a Trailer conveying heavy duty construction bulldozer was passing through it towards the Agbor axis of the state.
The deplorable condition of federal road has been on the news, with report of the road project already awarded for reconstruction by the federal government.
The road link many communities in the state and connect the people with other parts of the country, particularly Northern and South-East states.
Deputy Speaker of the Delta State House of Assembly, Chief Ochor Christopher Ochor who hails from the area, regretted that the federal government had not given such an important road the desired attention.
Ochor who spoke to our Correspondent, described the collapsed of the bridge as unfortunate and sympathized with stranded motorists and travelers for the pains it may have caused them.
He said he had already contacted the Commissioner for Work in charge of Urban and Highways roads in the State, Mr Neol Omodion, who has promised to take necessary steps to address the ugly situation.
Ochor however stressed the need to beef up security in the area to protect the lives and properties of the stranded travelers, calling on the federal government to reconstruct the road due to its strategic position to the socio economic development of the area.
W/Bank: Higher inflation ahead as oil price hits $86/barrel
The World Bank Group says a higher global inflation rate is ahead, noting the current oil price rise may continue into 2022, after recording 80 per cent higher this year than what it was in 2020.
The latest Commodity Markets Outlook released on Thursday reported the global lender as saying higher oil prices were also impacting food security in some countries already.
This came as Brent Crude prices hit $86.10 per barrel early on Thursday, jumping to the highest level in three years, before retreating to just above $85 amid profit-taking.
Experts said the reluctance of OPEC+ to pump more in the short term suggests that oil prices will remain well supported for the remainder of this year.
Although Nigeria has set a $57 per barrel benchmark for the 2022 budget, it is expected to produce 1.88 million barrels per day while targeting N3.16 trillion from oil proceeds.
The World Bank outlook indicated that energy prices soared in the third quarter of 2021 and are expected to remain elevated in 2022, adding to global inflationary pressures and potentially shifting economic growth to energy-exporting countries from energy-importing ones.
“Energy prices, expected to average more than 80% higher in 2021 compared to last year, will remain at high levels in 2022 but will start to decline in the second half of the year as supply constraints ease.”
The global bank however feared that non-energy prices, including agriculture and metals, are projected to decrease in 2022, following strong gains this year.
Chief Economist and Director of the World Bank’s Prospects Group, Ayhan Kose, said, “The surge in energy prices poses significant near-term risks to global inflation and, if sustained, could also weigh on growth in energy-importing countries.”
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