A running joke among Nigerians is that the country is so mired in debt that every Nigerian has a certain amount hanging over their heads. Now, whether or not this is true remains to be seen but that it is even whispered points to Nigeria`s staggering struggles with the creditor. That the country is exhibiting classic signs of a drowning man answers the question whether any country can survive the suffocation that a mountain of debt certainly translates to.
The alarm about the frail state of Nigeria`s economy has certainly been ringing for a long time now. But like many other such alarms, it has always fallen on deaf ears.
The Debt Management Office recently disclosed that Nigeria`s total public debt stock increased from N41.60tn as of March 2022 to N42.84tn as of June of the same year showing an increase of N1.24tn in three months.
According to the DMo, external debt remained the same at N16.61tn($40.06bn) from Q1 to Q2 2022, adding that 58 per cent of external debts were concessional and semi concessional loans from multilateral lenders such as the World Bank, the International Monetary Fund, Afrexim and African Development Bank and bilateral lenders including Germany, China, Japan, India and France.
According to the DMO, domestic debt also rose to N26.23tn($63.24bn) as a result of new borrowings by the government to part-finance the deficit in the 2022 Appropriation (Repeal and Enactment) Act. as well as new borrowings by State Governments and the Federal Capital Territory.
The DMO further noted that the Total Public Debt to GDP as of June 30,2022 was 23.06 per cent compared to the ratio of 23.27 per cent as of March 26,2022 adding that the Debt Service-to-Revenue ration remained high.
All these may sound like some economics jargon for the uninitiated but the harrowing reality is that the Nigerian economy is on life support.
Only last month, inflation rose to a record 15-year high, showing in the process that whatever the current administration has been doing to improve the Nigerian economy is failing badly.
Can a country which has to borrow to keep going ever run a sustainable system that would give its citizens a shot at anything resembling stable, comfortable lives?
For all Nigeria has borrowed over the years and the stigma compulsive borrowing has stamped on the country,to what extent has the country been able to properly utilize resources borrowed in the last few years?
Of course, has it ever happened that anyone successfully stored water in a basket anywhere? With corruption and cluelessness unyielding vices among many of those who have held the reins of power in the country since 1960, it does not take clairvoyance to know that not a small amount of every money Nigeria has borrowed in the last couple of years has disappeared into private pockets, or have been simply consumed by projects that were poorly executed.
Nigeria`s debt profile speaks to a country set up to fail. Nigeria`s population is projected to hit 216 million by November 2022. For how long will these many people continue to live off debts? Alas, it appears that even the time is borrowed time.