Business Hilights
Tracking Nigeria's Headline Business News Online

True position of federal, states debts profiles between former, present govts

By Emmanuel Olorunmagba
The Vice President was right when he stated that Nigerian Debt profile as of today stands at $73 Billion, inheriting $63 Billion from previous administration and partly right when he said they borrowed only $10 Billion in 3 years.
But what he failed to do was to decompose that $73 Billion debt profile and luckily that is what I am going to do here.
According to Debt Management Office (DMO) data, the Foreign Debt of Nigeria stands at $22.083 Billion which is equivalent to 6.8 Trillion Naira.
This $22.083 Billion were incurred by both the FG, 36 States and FCT combined.
But when decomposed, the FG’s external debt stands at $17.8 Billion while the 36 States and FCT incurred $4.28 Billion. Source
So out of this $17.8 Billion, APC borrowed $7.5 Billion from China, borrowed another $328 Million from China to finance the telecom industry.
The FG also borrowed $3 Billion to service maturing debt and is also currently planning to borrow $4.4 Billion for the 2018 budget.
When you deduct Buhari’s external borrowing from our external debt of $17.8 Billion, then it means Jonathan’s external debt was about $7 Billion.
But this is one thing the Vice President failed to tell Nigerians.
DMOAgain, the external debt of the States and FCT stands at $4.28, out of which Lagos contributed $1.45 Billion, followed by another APC State Edo at $279 Million and Kaduna at 3rd with $239.3 Million then Bauchi at 4th with $134.9 Million, while the other top 10 APC states owes a total of $750.34 Million. (Source: Premium Times)
This means that 14 out of over 20 APC States are responsibly for $2.863 Billion of the $4.28 Billion owed by the 36 States and FCT.
Again, the Vice President failed to tell Nigerians that 14 APC states out of the 36 States and FCT are responsible for 66.89% of the external debts incurred by the 36 States and FCT.
At the domestic scene, out of the $51.1 Billion owed, FG is responsible for $39.7 Billion while the States and FCT incurred $11.4 Billion.
Lagos as usual is the highest borrower and is responsible for 14.88% of that $11.4 Billion while Anambra is responsible for 0.08%.
The Vice President also, failed to tell Nigerians this.
Besides, the Federal Government did not incur its share of the domestic debt through direct borrowing.
The reason for this clarification is so that some people won’t erroneous think that this administration’s share of Nigeria’s domestic debt is part of the $10 Billion the Vice President said they borrowed, even though they borrowed more than that.
So Federal Government’s domestic debts were incurred through FGN Bonds which accounts for 73.4% and Treasury Bills 24.3%. See Source Here
It is now clear that current administration has borrowed more than the immediate past government.
Giving incomplete information to launder their image wouldn’t help them at the polls.

*Olorunmagba, a Finance analyst, wrote in from Lagos