A public affairs analyst, Ogbuefi Uwa Bunkoye, has listed nine issues the Nigerian economy is grappling with.
Bunkoye’s list is in reaction to the recent news that Nigeria’s public debt has surged to a staggering N87.38 trillion, marking a whopping 75.29% increase in just three months.
An analysis of the public debt stock released by the National Bureau of Statistics shows that each Nigerian currently owes N396,376.19 in terms of debt per capita.
The latest figures also mean that Nigeria’s total public debt grew by 622% in 8 years – an average of 78% annual growth.
President Bola Tinubu recently stated that servicing Nigeria’s public debt with 90% of revenue is unsustainable.
Bunkoye said the reasons for the public debt are:
1) About half of the adults in Nigeria are under or unemployed
2) Insecurity, armed bandits and Islamist militants have free rein across large swathes of the country’s north
3) According to the World Bank, About 40% of the nation’s more than 200 million people live in dire poverty
4) Inflation climbed to an 18-year high of almost 23% in June
5) The government spent 96% of its revenue in 2022 on servicing its loans
6) Corruption is endemic, and many state institutions are dysfunctional
7) Oil production, which is the lifeblood of the economy, hit lows last seen in the 1980s in late 2022
8) Gross Domestic Product growth barely keeps pace with the population increase and is far slower than needed to make significant inroads into mitigating extreme poverty
9) Increased migration rate popular as JAPA due to deterioration in the education, health and social system.
He noted that Nigeria, which has long been contending with economic challenges, is now confronted with the grim reality that approximately 96% of its revenue is dedicated to servicing its burgeoning debt.
He added: ”With 38.05% of this debt being external, exchange rate fluctuations and rising interest rates pose challenges.
”The government faces a critical juncture, requiring prudent financial management and diversification of revenue sources for a sustainable future.
”While debt can be a valuable tool for financing critical infrastructure and development projects, its unchecked growth can lead to severe economic consequences, potentially hampering the nation’s ability to invest in education, healthcare, and other essential services.”