Nigeria’s domestic debt service rises by N152.32bn in 2015

•Naira eases by 27% to N283.42

The amount of money spent by the Federal Government of Nigeria (FGN) in settlement of domestic debt as at end of December 2015, has increased by 17.59 per cent to N152.32 billion.

FGN’s domestic debt service for the period amounted to over N1.018 trillion compared to N865.81 billion in the corresponding period of 2014.

According to the Debt Management Office (DMO), this amount comprised principal repayment of N25 billion and interest payment of N993.13 billion.

The just released 2015 Annual Report of the Debt Management Office (DMO) indicated that this year alone, even in the face of cash crunch when the Federal Ministry of Finance is yet to make any quarterly release in implementing the 2016 budget, N446 billion has already being paid out to creditors in debt servicing.

This is just as the naira spot rate on Wednesday depreciated by 27 per cent to close at N283.42 to the dollar as against Tuesday’s close of N282.67 to the greenback.

The local currency at the unofficial (black) market crashed against the American dollar for the first time this week, as it exchanged for N356 to the greenback compared with Tuesday’s close of N353/$1 rate.

While the local currency closed at N372.70 to the British Pounds and N314.27 to the Euro at the inter-bank market on Tuesday, a currency trader at the Hadji Camp end of the Murtala Muhammed International Airport told Nigerian Tribune that the naira also weakened against the Pound Sterling (GBP) and the Euro, as it traded for N465 and N390 respectively at the unofficial market on Wednesday.

An online media, NAIJ.com quoted a Bureau De Change operator in Lagos as having said: “We are running out of dollar and until the CBN begins to sell forex that is when we can support the economy. Should the CBN agree to sell to us, they can be rest assured we would follow due process as well as comply with all regulatory requirements.”