Data obtained from the Debt Management Office’s website recently showed that the nation’s total debt increased to $60.8bn (N12.1tn) as of March 2015, up from N11.2tn at the end of December 2014.
The statistics also revealed that foreign debt stood at $9.46bn at the end of March, down from $9.71bn at the end of 2014.
This means that the current foreign debt is about 15% of the total debt.
In order to tap into loose monetary policy in advanced economies the Federal Government had in 2013 said it would increase the amount it borrowed overseas to 40% of the total debt over a three-to-five year
However, deteriorating oil prices has left the sharp drop in revenue, leaving the government struggling to pay bills including state salaries. The naira has also come under severe pressure.
The former Minister of Finance, Dr. Ngozi Okonjo-Iweala, had said in early May that the government had already used half the borrowing allowance it had budgeted for as lower oil prices reduced revenues.
The rebasing of the economy last April made Nigeria’s Gross Domestic Product to almost twice to more than $500bn, Africa’s largest.
However tax collection as a percentage of revenue is a paltry 6 per cent
Mr. Ayodeji Ebo, Economic analyst, said the vast deficit in the 2015 budget had shown that the federal government would increase its borrowing this year.
“The main concern is that the borrowings have been used to finance recurrent expenditure instead of recurrent expenditure,” he said.