Nigeria’s total debt to the World Bank Group rose by $660 million in the first six months of 2022, The Punch has learned.
This is based on data from both the Debt Management Office and the World Bank’s financial statements.
According to the DMO, Nigeria’s debt to the Washington-based bank was $12.38 as of December 31, 2021.
The World Bank’s financial statements for fiscal 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 provided loans to Nigeria over the years.
The IBRD provides loans to governments of middle-income and creditworthy low-income countries, while the IDA provides concessional loans – called loans – and grants to governments of the poorest countries.
Nigeria’s debt to the IDA and IBRD as of June 30, 2022 was US$12.55 billion and US$486 million, respectively, compared to US$11.97 billion and US$410.60 million as of December 32, 2021 .
According to a recent Punch report, rising debt has put Nigeria on the World Bank’s list of top 10 IDA borrowers.
The World Bank’s audited financial statements for FY2021 for IDA showed that Nigeria, with an IDA debt stock of $11.7 billion,
However, the World Bank’s newly released audited financial statements for FY2022 for IDA showed that Nigeria has moved up to fourth place on the list with an IDA debt stock of US$13 billion as of June 30, 2022.
This shows that Nigeria has accumulated about $1.3 billion in IDA debt in one fiscal year, with the country taking Vietnam’s fourth-largest debtor position.
This debt is distinct from the outstanding $486 million loan from the World Bank’s International Bank for Reconstruction and Development.
The top five countries on the list have reduced their IDA stocks slightly, 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 announced that Nigeria’s debt, which could currently be considered sustainable, is vulnerable and costly.
The bank said: “Nigeria’s debt remains sustainable, albeit vulnerable and costly, particularly given the sizeable 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 macrofiscal shocks.
The bank also expressed concern about the country’s debt-servicing costs, which it says are disrupting public investment and spending on the delivery of critical services.