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What’s The Implication As FG’s Expenditure Outgrows Its Revenue?
ESCALATING DEBT!
Revenues which rose from 2011 level of N2.57 trillion to N3.13tr in 2013 has since fallen to N2.66tr in 2017 despite hitting an all-time rise of N3.5 trillion in 2013.
A THREAD on #NGRdebtStatus
ESCALATING DEBT!
Revenues which rose from 2011 level of N2.57 trillion to N3.13tr in 2013 has since fallen to N2.66tr in 2017 despite hitting an all-time rise of N3.5 trillion in 2013.
A THREAD on #NGRdebtStatus
Btw 2012-2017, FG's fiscal deficit was > capital expenditure.
That is, the govt borrowed to fund recurrent expenditure items. Capital expenditure as a % of total fiscal deficit fell from 95.79% in 2013 to 7.89% in 2016. In 2017, it accounted for 37.83% of total fiscal deficit.
That is, the govt borrowed to fund recurrent expenditure items. Capital expenditure as a % of total fiscal deficit fell from 95.79% in 2013 to 7.89% in 2016. In 2017, it accounted for 37.83% of total fiscal deficit.
FG's debt servicing is going wild.
Out of every N100 that Nigeria earned in 2017, N61 was spent on servicing debts.
The FG now needs to take in more debts to meet its recurrent expenditure obligations as personnel costs & debt servicing are projected to overtake revenue uptake.
Out of every N100 that Nigeria earned in 2017, N61 was spent on servicing debts.
The FG now needs to take in more debts to meet its recurrent expenditure obligations as personnel costs & debt servicing are projected to overtake revenue uptake.
External debt is also peaking.
After Nigeria's glorious exit from Paris & London Clubs, FG’s external debt has risen from 2012 $6.5bn to $17.8bn in 2018, showing that as bond payments are due for settlements, NGR's external debt servicing/repayments will soar in the years ahead.
After Nigeria's glorious exit from Paris & London Clubs, FG’s external debt has risen from 2012 $6.5bn to $17.8bn in 2018, showing that as bond payments are due for settlements, NGR's external debt servicing/repayments will soar in the years ahead.
States more dependent on federal revenues.
The IGR of 36 states btw 2011 & 2017 was N5.14 trillion while states spent approximately N14.39trn on recurrent expenditure within same period. Rising debt level without expense on self-liquidating assets would strain future revenues.
The IGR of 36 states btw 2011 & 2017 was N5.14 trillion while states spent approximately N14.39trn on recurrent expenditure within same period. Rising debt level without expense on self-liquidating assets would strain future revenues.
States MUST be careful of External Debts.
Lagos is responsible for 33% of the external debt accumulated by states. With the recent exchange rate fluctuations, it is important for states to be cautious when they take on new external debts.
Lagos is responsible for 33% of the external debt accumulated by states. With the recent exchange rate fluctuations, it is important for states to be cautious when they take on new external debts.
