As reactions continue to trail the recent release of official data on Nigeria’s public debt profile, analysts at United Capital Research have played down concerns about the country’s rising external debt. According to the Debt Management Office (DMO), Nigeria’s total public debt stock jumped year- on-year (y-o-y) by 15.64 per cent to N33.11 trillion as at March 2021 (from N28.63 trillion as at March 2020).

The y-o-y increase in the nation’s total public debt stock was chiefly due to a 24.86 per cent rise in external debt to N12.47 trillion (or $32.86 billion at N379.50/USD) as at March 2021 from N9.99 trillion (or $27.67 billion at N361.00/USD) in March 2020. However, in a report obtained by New Telegraph, United Capital Research analysts, who analysed the DMO data, argued that Nigeria’s external debt burden was “modest,” given that about two-thirds of the debt stock is due to concessional lenders.

The analysts said: “The FGN’s external debt service payments amounted to $1.00 billion in Q1’21, a combination of $760 million and $240 million due to market and nonmarket creditors respectively. Once we exclude the FGN’s decision to pay down the $500 million Eurobond maturing in January and, therefore, ease its debt profile, the burden is modest because about two-thirds of the debt stock is due to concessional lenders. This should not be a challenge for an oil producer generating revenue from its current quota of 1.55mbpd from the OPEC+ alliance and from condensates, which are exempt from quota.”