Nigeria will use nearly a quarter of the proposed N10.3 trillion 2020 budget to service debts the government owes locally and internationally.
Giving details of the record budget to legislators on Tuesday, President Muhammadu Buhari said his government will spend N2.5 trillion to service debts, noting that the budget is targeted at “strengthening the country’s macroeconomic environment, human capital development, critical infrastructure and the enhancement of the administration’s social investment programme”.
Mr Buhari explained that the huge provision for debt payment is to register the country’s commitment to meeting its obligations.
He said, “Of this amount, 71 per cent is to service domestic debt which accounts for about 68 per cent of the total debt. The sum of N296 billion is provided for the Sinking Fund to retire maturing bonds issued to local contractors.
“I am confident that our aggressive and re-energised revenue drive will maintain debt-revenue ratio at acceptable and manageable levels. We will also continue to be innovative in our borrowings by using instruments such as Sukuk, Green Bonds and Diaspora Bonds.”.
According to figures published by the Debt Management Office, Nigeria’s debt stood at N24.947 trillion (US$ 81.274 billion) at the end of March 2019.