With the new borrowing limit set by the Federal Government, Nigeria can expand its current debt portfolio from N33.11tn to N61tn.
The new borrowing limit contained in the Medium Term Debt Strategy, shows that Nigeria has raised its borrowing limit from 25 per cent of the Gross Domestic Product to 40 per cent.
This information came even as the Senate gave new approvals to the Federal Government to borrow $8.33bn and €490m from external sources.
As of December 31, 2020, the National Bureau of Statistics put the country’s GDP at N152.32tn. Thus, forty per cent of the current GDP is N60.93tn.
Twenty-five per cent of the current GDP is N38.08tn, an amount which the nation may have surpassed in debt given that there are loans which the nation has already secured but are not included in the debt stock because they have not been drawn down.
This means that Nigeria can borrow as much as N60.93tn. Thus, with Nigeria’s current debt currently at N33.11tn, the new borrowing limit has given the country the leeway to expand its debt portfolio by up to N27.82tn.
Director-General of the Debt Management Office, Patience Oniha dismissed insinuations that the new approval given by the Senate may have taken the country beyond the set borrowing limit.