The International Monetary Fund, IMF, has projected that debt servicing will gulp as much as 14 percent of government revenue in Nigeria and other low income countries.
While providing an overview of the global economy outlook on Thursday, Kristalina Georgieva, the managing director of the IMF said the trend of rising debts, which began more than a decade ago during a prolonged period of very low interest rates, was exacerbated by the Covid 19 pandemic which necessitated an unprecedented fiscal response to protect lives and livelihoods.
Contrastingly, she says that in advanced economies, excluding the US, interest payments on public debt will average about 5 percent of government revenues this year.
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She noted that globally, countries are in an era of far higher interest rates which is pushing up the cost of servicing debt.
Nigeria’s total debt profile stood at N97 trillion at the end of 2023. This figure includes local and external debts owed by all 36 states and the Federal Capital Territory.
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