An economist, Johnson Chukwu, has warned that Nigeria is gradually plunging into a debt crisis with a current debt-to-GDP ratio of 49.51 per cent while calling for diversification of foreign exchange earnings.
In its virtual ‘Half Year 2024 Nigerian Economic and Financial Market Review and Outlook’, the Chief Executive Officer of Cowry Asset Management Limited argued that although the nation’s debt to GDP ratio is not yet 50 per cent a situation where the country is owing multilateral agencies about $20.83 billion, constituting close to 49 per cent of the nation’s foreign debt portfolio of $42.15 billion is of great concern.
“If you look at our local currency debt of about N65.65 trillion that we owe, N61.57 trillion and 78 per cent of that is on bond which has a very long maturity profile in the region of 20 to 30 year.” He pointed out that Nigeria would save close to 35 per cent of the total amount spent on importation if the country would ensure the domestication of refining and crude production.
According to him, this is hinged on factors, which include the upcoming harvest season, government suspension of taxes on some food items, relatively stable exchange rates and very weak consumer demand.
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