According to information obtained by The Spectator, the federal government spent 85.37 percent of its February revenue servicing debt.
The Federal Government had maintained revenue of N478.57 billion in February, according to the Central Bank of Nigeria’s monthly economic report for February 2023.
The bank added that in the same month, the Federal Government spent N408.5 billion on debt servicing.
The report also revealed that Nigeria has a budgetary deficit of N513.05 billion in February.
According to the report, the FGN’s expected overall budget deficit increased in February as a result of a decline in retained revenue. The FGN’s interim fiscal deficit increased by 22.8% from the previous month to N513.05 billion. However, it fell 16.2% short of the target set by the budget.
The Federal Government expects to spend 82% of its revenue on interest payments in 2023, according to latest data from the International Monetary Fund.
According to the IMF, total external debt, including private sector debt, will reach $121.6 billion.
According to the forecasts, less money will be utilized by the government to pay interest, with the percentage falling from 96.3% in 2022 to 82.3% in 2023.
In addition, it stated that in 2020 and 2021, respectively, interest payments were 86.1% and 87.8% of the federal government’s revenue.
The World Bank also predicted that by 2023, debt servicing will consume 123.4% of federal government revenue.
This was said in a presentation given in November 2022 by Alex Sienaert, the new World Bank Lead Economist for Nigeria, which our source was able to secure.
The chief economist of the World Bank for Nigeria stated in his presentation that increasing borrowing was not the answer for Nigeria.It said that in a table of projections in its ‘IMF Executive Board Concludes 2022 Article IV Consultation with Nigeria Summary.’
The document read, “Borrowing more is not the solution: debt costs are rising rapidly, squeezing non-interest spending.
“Debt servicing has surged over the past decade and is expected to continue increasing over the medium-term, crowding out productive spending.”
