Alhaji Lai Mohammed, the Minister of Information and Culture, has addressed former President Olusegun Obasanjo’s concerns on Nigeria’s rising debt stock.
Obasanjo recently raised an alarm on Nigeria’s debt profile.
Speaking at a media parley held on Monday, December 30, 2019, the minister stated that President Muhammadu Buhari-led administration alone could not be blamed for the country’s debt stock.
Mohammed said the debt stock was “a cumulative figure of borrowings by successive governments over many years”, adding that no government would sit by and do nothing in the face of massive infrastructural decay.
“Recently, there have been concerns in certain circles about the country’s growing debt, both domestic and external.
In the process, there have been some misrepresentations and scaremongering. We, therefore, believe it is important to put things in the right perspective, so our citizens will be well informed
“The public debt stock is actually a cumulative figure of borrowings by successive governments over many years. It is therefore not appropriate to attribute the public debt stock to one administration.
“Nigeria’s total public debt stock in 2015 was $63.80 billion, comprising $10.31 billion of external debt and $53.49 billion domestic debt.
By June 2019, the total debt stock was $83.883 billion, made up of $27.163 billion of external debt and $56.720 billion domestic debt. It is therefore not correct to say that Nigeria’s external debt alone is $81.274 billion.
“There is yet no cause for alarm. This is because Nigeria has a debt ceiling of 25 percent in the total public debt stock to Gross Domestic Product (Debt/GDP), which it has operated within. The ratio for December 31, 2018, and June 30, 2019, were 19.09 percent and 18.99 percent, respectively,” the minister was quoted.
Mohammed, however, noted that the debt service to revenue ratio had been higher than desirable, which informed the push by the incumbent government to diversify the economy and increase oil and non-oil revenues significantly.