Nigeria’s External Debt Service Rises 37% To $2.1bn

Nigeria spent $2.12billion to service external debt in 2021, representing 37per cent increase from $1.56billion spent in 2020.
Data from Central Bank of Nigeria (CBN), however, shows a 58per cent decline in debt service payment in the second half of the year (H2’21) to $824.41million from $1.3billion in the first half of the year (H1’21).
But the $824.41million external debt service payment in H2’21 represents a 3.4per cent, year-on year (YoY) increase from $797.48million spent in the corresponding period of 2020 (H2’2020).
Similarly, the $1.3billion spent on external debt service in H1’21 represents 72per cent, YoY increase from $755.38million spent in H1’2020.
Further analysis shows that the highest external debt service payment was recorded in first quarter of the year (Q1’21) when debt service payment rose YoY by 114per cent to $1.003billion from $468.34million in Q1’2020.
The growth in external debt service payment slowed down the second quarter (Q2’21) to $298.97million, representing a 3.8per cent YoY increase from $287.04million in Q2’2020.
In the third quarter (Q3’21), external debt service payment rose to $520.78million, representing 2.6per cent increase from $508.03million in Q3’2020.
In the fourth quarter (Q4’21), the amount spent on external debt service payment recorded another YoY increase of 5.2per cent to $303.64million from $289.45million in Q4’2020.
The sharp increase in external debt service payment in 2021 was driven by the 18.6per cent YoY increase in the nation’s external debt in the first three quarters of 2021.
Data from the Debt Management Office (DMO) showed that total external debt stood at $37.95billion at the end of Q3’21, representing 18.6per cent from $31.99billion at the end of Q3’2020.