According to the data by the CBN, as of July, 2024, the credit to the government stood at N19.8trillion but jumped to N31.1 trillion in August, 2024.
A review of the Central Bank of Nigeria (CBN) data has shown that the apex bank’s credit to government grew by N11.3 trillion between July and August 2024.
According to the data by the CBN, as of July, 2024, the credit to the government stood at N19.8trillion but jumped to N31.1 trillion in August, 2024.
This reliance on local sources for loan comes at a time where there have been concerns on the heavy indebtedness of the country and the impacts of these loans on the ability of the country to develop maximally.
This is given that monies meant to be used for development are usually stated as going for debt servicing.
SaharaReporters observed that the growth in credit to government recorded between July and August is the highest single surge since the beginning of this year.
Only the surge between January and February, 2024, where there was an increase of N10.4trillion in debt portfolio came near.
State governments have over time being heavily linked with reliance on domestic borrowings.
A SaharaReporters’ review of budget performance documents for half year, 2024, gave a clearer picture.
States are not just budgeting huge amounts for loans but are also executing same.
In the first six months of 2024, Katsina State borrowed N34 billion from international sources.
Bayelsa State budgeted to borrow N64 billion in 2024, with an estimated N60billion from domestic sources and another N4 billion from international sources.
Adamawa State government budgeted to borrow N41.2 billion in 2024, with an estimated N38.5 billion from domestic sources and another N2.7 billion from international sources.
The same situation was recorded in Cross Rivers state, with a loan budget of N141.8 billion for the 2024 fiscal year.
Other states reviewed also plan to borrow or have borrowed heavily in the 2024 fiscal year, painting a grim picture of the Over-reliance on loans by government at different levels.
A recent report by SaharaReporters noted that the external debt service payment by the federal government in the first seven months of 2024, stood at over $2.78 billion.
This is also as the country itself has been quoted as through its Vice-president, Kashim Shettima, begging for debt relief from donor countries.
Nigeria suffers from developmental challenges such as dearth in water provision, education, social amenities among others.
There have also been concerns over poor fiscal management in the country including corruption and concerns over accountability in the system