Nigeria is considering restructuring its debt and extending the repayment period of its credit obligations, and appointed consultants to advise the government as it faces a rising debt-service burden, Finance Minister Zainab Ahmed said.

The government also plans to refinance domestic debt obligations that are due this year and next, while the country’s 20 trillion naira ($45.4 billion) in outstanding borrowings from the central bank will be bundled into government bonds, Ahmed said in a Bloomberg TV interview.

“For the larger portfolio of debt, we have just appointed a consultant to assess how the government can get additional relief by way of restructuring and negotiating to stretch out the repayments to longer periods,” Zainab Ahmed.

Nigeria faces a rising debt service burden that the World Bank estimates will hit 102% of revenues this year. The government last week laid out an ambitious 20.5 trillion spending program for next year, half of which is not backed by revenues.

In June 2022, Nigeria’s total public debt climbed to N42.84 trillion ($103.31 billion) from N41.60 trillion ($100.07 billion) in March 2022.#TheCableIndex pic.twitter.com/RHQZlAMD6C

— TheCableIndex (@thecableindex) October 4, 2022

The move to restructure the country’s debts should increase the fiscal space necessary to deliver on the government’s priorities in the remainder of the time it has left, Joachim MacEbong, senior governance analyst at Stears Insights, said. “However, the rate of debt accumulation must reduce so as not to handicap the next administration.”

Lawmakers have approved the government’s plan to borrow as much as 8.4 trillion naira to plug part of the shortfall — an estimated 10.78 trillion naira or 4.8% of the gross domestic product.

“The budget is designed for us to raise financing 50% from domestic and 50% from the international financing and this will be a combination of concessionary sources and bilateral sources as well as the international capital market,” Finance Minister Zainab Ahmed.

Read also; Nigeria’s Central Bank Hikes Interest Rates to 15.5%.

Nigeria is considering restructuring its debt and extending the repayment period of its credit obligations, and appointed consultants to advise the government as it faces a rising debt-service burden, Finance Minister Zainab Ahmed said.

The government also plans to refinance domestic debt obligations that are due this year and next, while the country’s 20 trillion naira ($45.4 billion) in outstanding borrowings from the central bank will be bundled into government bonds, Ahmed said in a Bloomberg TV interview.

“For the larger portfolio of debt, we have just appointed a consultant to assess how the government can get additional relief by way of restructuring and negotiating to stretch out the repayments to longer periods,” Zainab Ahmed.

Nigeria faces a rising debt service burden that the World Bank estimates will hit 102% of revenues this year. The government last week laid out an ambitious 20.5 trillion spending program for next year, half of which is not backed by revenues.

In June 2022, Nigeria’s total public debt climbed to N42.84 trillion ($103.31 billion) from N41.60 trillion ($100.07 billion) in March 2022.#TheCableIndex pic.twitter.com/RHQZlAMD6C

— TheCableIndex (@thecableindex) October 4, 2022

The move to restructure the country’s debts should increase the fiscal space necessary to deliver on the government’s priorities in the remainder of the time it has left, Joachim MacEbong, senior governance analyst at Stears Insights, said. “However, the rate of debt accumulation must reduce so as not to handicap the next administration.”

Lawmakers have approved the government’s plan to borrow as much as 8.4 trillion naira to plug part of the shortfall — an estimated 10.78 trillion naira or 4.8% of the gross domestic product.

“The budget is designed for us to raise financing 50% from domestic and 50% from the international financing and this will be a combination of concessionary sources and bilateral sources as well as the international capital market,” Finance Minister Zainab Ahmed.

Read also; Nigeria’s Central Bank Hikes Interest Rates to 15.5%.