It is imperative for the incoming Government to evolve ways of generating revenues to ensure debt sustainability, the Debt Management Office, DMO has said.
It also suggested that the new Government should take into account the perennial budget deficits in the preparation of the Medium-Term Expenditure Framework for 2024 to 2026.
In a statement, the DMO explained that Nigeria’s debt stock has been growing largely due to new borrowings arising from successive deficits in the annual budgets.
The Director General, Ms. Patience Oniha, said the records show that deficits in the Annual Budgets including Supplementary Budgets rose to N10.78 trillion in 2023 from N1.62 trillion in 2015.
She said between 82% to 99% of these were funded by new borrowing which ranged from N1.46 trillion in 2015 to N8.8 trillion in 2023.
”Budget deficits, funded by new borrowings, have been responsible for the rapid growth in the debt stock and the resultant increases in debt service,” the statement read.
The DG said the trend could have been avoided or at least moderated if revenues had been higher or expenditures lower; in which case the budget deficits would have been much smaller, or the country would have operated on a balanced budget.
Writing by Biodun Dare; Editing by Annabel Nwachukwu