A Dataphyte review of the Medium Term Expenditure Framework has revealed that Nigeria will borrow N14.8 Trillion between 2022 and 2024. According to the document, the projected figure for 2022 stands at N4.89 Trillion. This is further broken into domestic borrowing of N2.44 Trillion and N2.44 Trillion for foreign borrowing.
The figure is projected to drop as the country targets borrowing N4.75 Trillion in 2023. Of this figure, domestic borrowing will take N2.37 Trillion while foreign borrowing is projected at N2.37 Trillion. This reduction is a 2.5% decrease from the 2022 projected borrowing.
However, in 2024 the borrowing will again increase to N5.35 Trillion, with both domestic and foreign borrowing equal at N2.67 trillion each. 2024 figures are 12.6% higher than the 2023 figures.
The borrowing schedule in the three years will increase the public debt of the country from the current figure of N38 Trillion to N52.8 Trillion by 2024, with total domestic debt at N29.91 trillion and total external debt at N23.05 Trillion.
Figures on the document also revealed that between 2022 and 2024, Nigeria will spend N14.6 Trillion on debt servicing. This is broken down as; N3.6 Trillion in 2022, N4.9 Trillion in 2023, and N6.1 Trillion in 2024. Debt service figures will increase by 36.1% between 2022 and 2023 and by 24.4% in 2023 and 2024.
During the same period, the debt service to revenue ratio is projected at 43% in 2022, 48% in 2023, and 57% in 2024.
This means that if the revenue of the country is projected to be N10 in the three years, then N4.3 naira will be used for debt servicing in 2022, N4.8 naira in 2023, and N5.7 naira in 2024. By 2024, over half of the country’s revenue will be used for debt servicing, according to projections.
Nigeria has continued to battle with financing its budget and has relied on loans to finance its budget with experts warning on the implications of this for the nation’s development and calls for fiscal responsibility.
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