LAGOS (Reuters) – The maximum amount that Nigeria can borrow in 2017 from both local and foreign sources is $22.08 billion without it violating its debt threshold, the Debt Management Office (DMO) said.
Nigeria has a borrowing space of 5.89 percent of its GDP of $374.95 billion which will take its debt limit to a country-specific threshold of 19.39 percent of its total public debt-to-GDP ratio, it said in a report.
Total public debt-to-GDP ratio for 2016 is projected at 13.5 percent, it said in a debt sustainability report seen by Reuters on Wednesday. It said total public debt-to-revenue stood at 28.10 percent as of 2015, slightly higher than 28 percent threshold.
President Muhammadu Buhari has asked parliament to approve $30 billion of foreign borrowing to fund planned infrastructure projects until 2018, according to a letter read out to lawmakers on Tuesday.
Nigeria’s public debt stood at 16.29 trillion naira as of June 2016, up from 12.60 trillion naira by end December.
“Although the level of debt stock is still appreciably low relative to the country’s aggregate output (GDP), the debt portfolio remains mostly vulnerable to the various shocks associated with revenue, exports and substantial currency devaluation,” the DMO said in the debt sustainability analysis report.
The DMO said the debt sustainability analysis showed that Nigeria’s debt position deteriorated in 2016 and slipped from a low-risk of debt distress to a Medium-risk of debt distress.
(Reporting by Chijioke Ohuocha; Editing by Angus MacSwan)