Debt to gulp 100% of Nigeria’s revenue in 2023 – World Bank

The World Bank has revealed that Nigeria’s revenue would not be sufficient to clear out its debt in 2023 as the country’s debt servicing would gulp 100.2 percent of the federal government revenue by the end of 2022.

The new World Bank Lead Economist for Nigeria, Alex Sienaert, disclosed this in a presentation titled, ‘Nigeria Public Finance Review: Fiscal Adjustment for Better and Sustainable Development Results.’

According to Sienaert, there was a decline from the earlier projection in its October Africa’s Pulse report, which is a biannual analysis of the near-term macroeconomic outlook for the region, published during the World Bank/IMF Spring and Annual Meetings in April and October.

In Africa’s Pulse report, the Washington-based bank said that Nigeria’s debt service-to-revenue ratio could stand at 102.3 percent by the end of 2022, describing the public debt in Nigeria as concerning due to the rising debt service-to-revenue ratio.

However, the situation would be dire in 2023 as debt survival would exceed 118 percent of revenue reported in the first four months of 2022.

Presenting the document, Sienaert noted that borrowing more money was not the solution for Nigeria.

“Debt servicing has surged over the past decade and is expected to continue increasing over the medium-term, crowding out productive spending.”

It was recently reported that Nigeria’s public debt rose to N44.06tn in the third quarter of 2022, with the country struggling with a repayment burden as revenue drought persists.

Debt Management Office reported that the total public debt stock rose from N42.84tn recorded in the second quarter to N44.06tn in the third quarter of 2022, The Will reports.

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