By Modupe Gbadeyanka
A total of N513 billion was spent on debt servicing by the federal, states and local governments in the first quarter of 2017, a recent report has revealed.
The Nigerian Extractive Industries Transparency Initiative (NEITI), in its quarterly review, noted that debt servicing took up 40.27 percent of FAAC disbursement for the first quarter of this year.
“The figure reveals that debt servicing as proportion of total FAAC allocations is generally higher in the first quarter of the year, after which it falls to lower levels.
“Based on this, the figure of 40.27 percent observed in the first quarter of 2017 might be an upper threshold and it would thus be expected that this figure will be lower for the remaining quarters of the year,” the report said.
However, the Debt Management Office (DMO) is yet to provide data on the figure for the second quarter of 2017.
In this direction, the NEITI publication expressed concern that, the nation’s debt, in relation to revenues, appears to have reached critical levels.
It further disclosed that domestic debt servicing constituted 90 percent of total debt servicing. The report also remarked that “domestic debt servicing consistently outstrips external debt servicing.”
“In the first quarter of 2015, domestic debt servicing made up over 93% of total debt servicing. This figure did not change much by the first quarter of 2017 as domestic debt servicing was over 92 percent of total debt servicing,” it added.
