The President Muhammadu Buhari led Federal Goverment has shown plans to borrow an additional N6.39 trillion to finance the 2022 budget deficit, News Agency of Nigeria reports.
In a document from Debt Management Office, the director-general Patience Oniha explained that the overall deficit in the 2022 budget was N6.30trillion, representing 3.46 per cent of the country’s Gross Domestic Product (GDP).
Oniha further explained that, “N2.57 trillion will come from domestic sources, N2.57 trillion from foreign sources, N1.16 trillion from multilateral and bilateral loan drawdowns and N90.7 billion from privatisation proceeds.”
“Recurrent (non-debt) spending, estimated to amount to N6.9 trillion, is 40 per cent of total expenditure and 20 per cent higher than the 2021 budget. Aggregate capital spending of N5.96 trillion is 35 per cent of total expenditure.”
According to the DMO official, debt service in the 2022 budget is N3.6 trillion, making it 21 per cent of total expenditure and 34 per cent of total revenue.
“Provision to retire maturing bonds of N270.7 billion to local contractors is 1.6 per cent of total expenditure. This provision is in line with the federal government’s commitment to offset accumulated arrears of contractual obligation dating back over a decade,’’ she said.
The country’s total debt stock as at December 2021 was N39.55 trillion and might rise to N45 trillion if the Goverment ends up getting the loan.