Local debt servicing gulps N1tn in one year

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The cost of servicing the Federal Government increasing domestic debt hit the N1tn mark for the first time in 2015, statistics obtained from the Debt Management Office have shown.

According to statistics obtained from the DMO, the Federal Government spent N1.02tn to service its domestic debt last year. This comprises of N25bn spent on repayment of the principal and N993.13bn on interest payment within the year. As of the end of December 2015, Nigeria total public debt stock stood at N12.6tn, compared to N11.25tn in 2014.

The difference represents an increase of 12 per cent (or N1.37tn) within the one-year period. External debt accounted for N2.11tn or 16.75 per cent of the total, while domestic debt took the remaining N10.49tn or 83.25 per cent. Out of this amount, the Federal Government domestic debt was N8.54tn.

In a report on the cost of the domestic debt, the DMO attributed the increasing cost of debt servicing to an equally increasing domestic debt profile and rising interest rate.

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