Total debt owed to the World Bank Group by Nigeria has increased by $660 million in the first six months of 2022, The Punch has learned.
This is according to data from the Debt Management Office and financial statements from the World Bank.
According to DMO data, Nigeria’s debt to the Washington-based bank was $12.38 as of December 31, 2021.
The World Bank’s financial statements for the financial year 2022 show that Nigeria owes the lender $13.04 billion as of June 30, 2022.
The International Bank for Reconstruction and Development and the International Development Association, which make up the World Bank, have over the years provided loans to Nigeria.
The IBRD lends to the governments of creditworthy middle-income and low-income countries while the IDA provides concessional loans – called credits – and grants to the governments of the poorest countries.
Nigeria’s debt to IDA and IBRD stood at $12.55 billion and $486 million respectively as of June 30, 2022, compared to $11.97 billion and $410.60 million as of December 32, 2021 .
According to a recent Punch report, rising debt has propelled Nigeria into the World Bank’s list of top 10 IDA borrowers.
The World Bank’s audited IDA financial statements for fiscal year 2021 showed Nigeria ranked fifth on the list with outstanding IDA debt of $11.7 billion as of June 30, 2021.
However, the World Bank’s recently released FY2022 IDA audited financial statements showed that Nigeria moved to fourth position on the list, with IDA debt outstanding of $13 billion. dollars as of June 30, 2022.
This shows that Nigeria has accrued about $1.3 billion in IDA debt in one fiscal year, with the country taking Vietnam’s fourth largest debtor position.
This debt is different from the outstanding loan of $486 million from the World Bank for reconstruction and development.
The top five countries on the list have slightly reduced their outstanding debt with IDA, with the exception of Nigeria.
Nigeria has the highest IDA debt in Africa, as the top three IDA borrowers (India, Bangladesh and Pakistan) are from Asia.
The World Bank recently revealed that Nigeria’s debt, which could be considered sustainable for now, is vulnerable and costly.
The bank said: “Nigeria’s debt remains sustainable, albeit vulnerable and costly, especially given the large and growing funding from the Central Bank of Nigeria.”
However, the Washington-based global financial institution added that the country’s debt also risks becoming unsustainable in the event of macro-fiscal shocks.
The bank further expressed concern over the cost of servicing the country’s debt, which it said has disrupted public investment and essential spending on service delivery.