Over 50 taxes cripple Nigerian businesses... Manufacturers, telecoms, aviation, SMEs most affected
Zainab Ahmed, Nigeria's Finance Minister

Nigeria’s debt service increased by 37% to $2.12 billion in 2021, up from $1.56 billion spent in 2020, data from the Central Bank of Nigeria (CBN) indicate.

There was however, a 58 per cent decline in debt service payment in the second half of the year to $824.41 million from $1.3 billion in the first half, but the the $824.41 million still represents a 3.4 per cent, year-on year, YoY increase from $797.48 million spent in the corresponding period of 2020.

Again, the $1.3 billion spent on external debt service in H1’21 represents 72 per cent, YoY increase from $755.38 million spent in H1’2020.

Further analysis of the data by Vanguard shows that the highest external debt service payment was recorded in first quarter of the year (Q1’21) when debt service payment rose YoY by 114 per cent to $1.003 billion from $468.34 million in Q1’2020.

The growth in external debt service payment slowed down the second quarter (Q2’21) to $298.97 million, representing a 3.8 per cent YoY increase from $287.04 million in Q2’2020.

In the third quarter (Q3’21), external debt service payment rose to $520.78 million, representing 2.6 per cent increase from $508.03 million in Q3’2020.

In the fourth quarter (Q4’21), the amount spent on external debt service payment recorded another YoY increase of 5.2 per cent to $303.64 million from $289.45 million in Q4’2020.

The sharp increase in external debt service payment in 2021 was driven by the 18.6 per cent YoY increase in the nation’s external debt in the first three quarters of 2021.

Data from the Debt Management Office, DMO, showed that total external debt stood at $37.95 billion at the end of Q3’21, representing 18.6 per cent from $31.99 billion at the end of Q3’2020.

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