Zainab Ahmed, the minister of finance, budget and national planning, has projected that Nigeria’s debt profile would hit N38.68 trillion by December 2021.
Speaking when she appeared before the senate committee on local and foreign debts on Tuesday, Ahmed estimated that both external and domestic debt would rise to N32.51 trillion by December 2020.
According to the Debt Management Office, the total public debt stock, which comprises the debt stock of the three tiers of government, stood at N31.009 trillion at the end of June 2020.
“The total public debt stock comprising the External and Homes debts of the Federal and state governments and the federal capital territory stood at N31.01 trillion (USD85.90 billion) as at June 30, 2020,” she said.
“It is projected, based on existing approval, to rise to N32.51 trillion by December 31, 2020, and N38.68 trillion by December 31, 2021.”
The International Monetary Fund estimated that Nigeria’s debt to gross domestic product (GDP) ratio stood at 29 percent in 2019; including Asset Management Corporation of Nigeria (AMCON) debt and power sector financing.
The federal government spent 97.5 percent of its January to May 2020 revenue on debt servicing.
During the five-month period, N1.58 trillion was spent on debt servicing; representing 97.5 percent of the N1.62 trillion revenue generated.
The minister attributed the various abandoned road projects in the country to poor funds releases caused by dwindling revenue.
“I am one person that feels that we should just take one major road in one geopolitical zone and finish it.
“We were not able to do that because of the processes in which appropriation is made both at the executive as well as the legislative arms of government.
“Truly, if we are able to just take one or two projects at a time and complete it before going to the next one, it will be better.
“You will see a road that costs, maybe N5 billion, and you will see a provision for N100 million, N200 million or 300 million.
“Of course the project will never finish. After two years, the contractor comes back and asks for variation, and the amount keeps growing.
“I wish that we get to a point when we sit down as government and agree that let us select a few projects, finish them in 2020, and then in 2021, we select the next.
“So that on a geopolitical basis, those selections are done as a collective process.”
Ahmed assured that legacy projects like the Lagos-Ibadan highway, 2nd Niger Bridge, East-West road, and Abuja-Kaduna-Kano road, are ongoing due to availability of funds.