Lai Mohammed, the minister of information and culture, says Nigeria’s public debt service is higher than desirable.
He also explained why the total public debt stock of Nigeria rose to $83 billion.
Mohammed spoke at a press conference on Monday in Ikeja, Lagos State.
According to him, the public debt stock is a cumulative figure of borrowings by successive governments over many years.
He said, “Recently, there have been concerns in certain circles about the country’s growing debt, both domestic and external. In the process, there have been some misrepresentations and scaremongering.
“It is not appropriate to attribute the public debt stock to one administration.
“Nigeria’s total public debt stock in 2015 was $63.80 billion, comprising $10.31 billion of external debt and $53.49 billion domestic debt. By June 2019, the total debt stock was $83.883 billion, made up of $27.163 billion of external debt and $56.720 billion domestic debt. It is therefore not correct to say that Nigeria’s external debt alone is $81.274 billion.
“There is yet no cause for alarm. This is because Nigeria has a debt ceiling of 25 per cent in the total public debt stock to Gross Domestic Product (Debt/GDP), which it has operated within.
“The ratio for December 31, 2018 and June 30, 2019 were 19.09 per cent and 18.99 per cent respectively.
“The debt service to revenue ratio has, however, been higher than desirable, hence the push by the government to diversify the economy and increase oil and non-oil revenues significantly.
“The government is also widening the tax base to capture more tax-paying citizens.”