Naira Crash Adds Trillions Of Debt To All The 36 States

Naira Crash Adds Trillions Of Debt To All The 36 States

Nigeria government and it's states owns alot of foreign debt, and as naira crashes, those foreign debt will keep increasing automatically.

Naira Crash Against US Dollar Adds Over N1.5trn to States External Debts, Lagos Worst.

With the value of the Naira seriously depreciating against the dollar, external debts of Nigeria, including 36 states, are becoming very expensive to service
10 states led by Lagos states account for a significant chunk of the total external debts held by states

Debt remains one of the biggest fiscal burdens of Nigeria, and more revenue is now needed to pay back
The external debt load of the 36 states and the Federal Capital Territory have significantly increased in naira terms.

This is thanks to the continued depreciation of the Nigerian currency at the official and unofficial foreign exchange markets.

Data from the Debt Management Office (DMO) showed that the total external debt stock of 36 subnational governments and the Federal Capital Territory, Abuja, stood at $4.34 billion or N1.80 trillion using the exchange rate of N414.58/$ as of June 1, 2023.

Today, September 20, 2023, the value of the external debt in naira terms has increased to N3.35 trillion at the current exchange rate of N771.27/$.

This represents an addition of N1.55 trillion in debt due to naira depreciation in just 3 months.

It is even worse if the current black market rate of N980 a dollar is used to calculate the external debt stocks of Nigerian states.

10 States with the highest debt burden
Lagos - $1.26 billion
Kaduna - $569.37 million
Edo - $258.40 million
Cross River - $153.17 million
Bauchi - $170.44 million
Adamawa - $100.92 million
Anambra - $105.58 million
Enugu - $120.67 million
Enugu- $111.62 million
Ondo - $80.84 million