Business

DMO Reveals How Petrol Subsidy Raised 2022 Borrowing By N1trn

Published

3 years ago

September 27, 2022

Editor

The nation’s public debt stock is being increased by the petrol subsidy as the government had to borrow N1 trillion to subsidise petrol this year, the Director-General of the Debt Management Office, DMO, Ms. Patience Oniha has said.

In a presentation at the Executive Course on Budgeting and Fiscal Transparency at the Army Resource Centre in Abuja, yesterday, she attributed the current debt stock to budget deficit, noting that the borrowing plan for 2022 was increased by N1 trillion to enable the government to pay the extra cost of petrol subsidy.

Despite the public debt stock of $42.8 billion, Ms. Oniha said remained within acceptable limits and sustainable,

Speaking on the topic, Debt Sustainability Challenges and Strategic Revenue Mobilisation Initiative, the D-G said that the federal government had to resort to borrowing to fund the budget due to revenue challenges.

She said that the DMO was deploying World Bank and International Monetary Fund tools to ensure the sustainability of Nigeria’s public debt.

According to her, “These tools include an annual Debt Sustainability Analysis (DSA) and a Medium Term Debt Management Strategy (MTDS) every four years.”

In addition, she said, “Maturities in the Public Debt Portfolio are well spread to avoid bunching of maturities and to ease repayments of maturing obligations. The Domestic Debt portfolio has securities with tenors ranging from 91 days to 30 years, while the External Debt Portfolio has securities ranging between 5 years to 30 years.”

She explained that despite criticisms of the government’s borrowing, Nigeria’s debt to GDP ratio remains among the lowest globally.

She pointed out that while Nigeria’s debt to GDP ratio was 23.06 percent, countries such as Angola (136.54%), South Africa (69.45%), Ghana (78.92%), United States (133.92%) and United Kingdom (104.47%) have higher ratios.

She however stressed that Nigeria was not alone in rising levels of public debts, pointing out that across the globe, governments were borrowing more to meet with economic and social challenges posed by the Covid-19 pandemic and the Russia-Ukraine war.

“Governments across the world borrow. Globally, debt levels are growing, but it is not a new trend. Debt levels were already rising prior to Covid-19 crisis when compared to 2014. Globally, sovereign debt grew from 49 percent of GDP in 2014 to 57.9 percent in 2019 and in sub-Saharan Africa, from 35 percent of GDP in 2014 to 55 percent in 2019. In Nigeria, this ratio rose from 13 percent in 2014 to 19 percent in 2019”, she stated.

The DG also explained that the government was not just borrowing for borrowing sake, emphasizing that the loans would enable the government to finance critical infrastructure with multiplier benefits (job creation, movement of persons and goods) and overall GDP growth.

She noted that the country was facing a revenue crisis, adding that it has become very important for the government at all levels to pay more attention on how to increase revenue generation as a means of reducing borrowing.

The DMO boss noted that Nigeria was performing poorly in terms of revenue, as she said that the country had a far lower revenue record than it could generate.

She said that the federal government has taken a number of measures to grow its revenue, while urging citizens and corporate bodies to pay their taxes in order to make funds available for the government to finance the various much-needed infrastructural facilities, across the country.

The D-G added that the issuance of federal government securities had several benefits for both the citizens and corporate organisations.

They included being safe investment opportunities with regular returns and being the vehicle for mobilizing large pools of funds from domestic and international sources for investments in capital projects

She added that the development of the domestic financial sector; Liquid assets for banks and other institutions who need to hold such assets; attracting foreign investors into the domestic markets; and providing sovereign yield curves in the domestic and international markets, against which other issuers such as State Governments, private sector entities and multilaterals can issue securities to raise capital were major advantages of the exercise.
VANGUARD

Business

Okonjo-Iweala Reveals How Nigeria Can Dominate AfCFTA

Published

15 hours ago

September 23, 2025

Editor

The Director-General of the World Trade Organisation, WTO, Ngozi Okonjo-Iweala, says Nigeria has what it takes to lead Africa’s new era of trade if it tackles high logistics costs, develops efficient payment systems, and invests in value addition.

Okonjo-Iweala, who was speaking on the sidelines of the WTO Public Forum in Geneva, Switzerland, said Nigeria and other African economies must speed up the implementation of the African Continental Free Trade Area, AfCFTA, and build stronger infrastructure to unlock billions of dollars in opportunities in manufacturing, services, and digital trade.

“The AfCFTA is a great step, but Africa trades only about 15–20 percent within itself — far below the European Union, EU’s 60 percent. We (Nigeria) need to speed up implementation so Africans trade more with each other.

“Take Lesotho: it exports around $200 million worth of textiles (jeans, etc.) to the U.S. — about 10 percent of its GDP — while Africa imports $7 billion of similar goods. Why not absorb Lesotho’s products within Africa? To unlock intra-African trade, we (Nigeria) need efficient payment systems (Afreximbank and others are working on this), better infrastructure and lower trade costs. It shouldn’t take longer to ship goods from Cape Town to Lagos than from China to Lagos.

“With critical minerals, energy, and new supply chains, plus opportunities in services and digital trade, there’s huge potential — if we invest in connectivity and implementation,” she said.

The former Nigeria’s Minister of Finance also cautioned that negative narratives about global commerce risk overshadowing recent successes achieved through multilateral cooperation.

Business

French Media Giant Canal+ Takes Over S.Africa’s Multichoice

Published

2 days ago

September 22, 2025

Editor

French media giant Canal+ said Monday it had taken effective control of South African television and streaming company MultiChoice, creating a group present in nearly 70 countries in Africa, Europe and Asia.

The companies said in a joint statement that the combined group will have a workforce of 17,000 employees and serve more than 40 million subscribers.

The acquisition is “the largest transaction ever undertaken” by Canal+, the statement said.

Canal+, which is already the sector’s leader in French-speaking African countries, now controls what it described as the leader in the continent’s English- and Portuguese-speaking regions.

“This acquisition allows us to strengthen our position as a leader in Africa, one of the most dynamic pay-TV markets in the world,” Canal+ chief executive Maxime Saada said in the statement.

The buyout was given a final green light by South Africa’s competition authority in late July, more than a year after Canal+ launched its bid.

Canal+ offered 125 rand ($7.2) per share for MultiChoice when it launched its offer last year, valuing the South African firm at around $3.0 billion.

Canal+ is present in 25 African countries through 16 subsidiaries and has eight million subscribers.

MultiChoice operates in 50 countries across sub-Saharan Africa and has 14.5 million subscribers.

It includes Africa’s premier sports broadcaster, SuperSport, and the DStv satellite television service.

AFP

Business

BREAKING: Nigeria’s GDP Grows By 4.23% In Q2 2025 – NBS

Published

2 days ago

September 22, 2025

Editor

Nigeria’s Gross Domestic Product grew by 4.23 per cent (year-on-year) in the second quarter of 2025, the National Bureau of Statistics revealed in its Q2 2025 GDP Report.

According to the report released on Monday on its website, the figure shows a significant improvement compared to 3.48 per cent recorded in the second quarter of 2024 and the 3.13 per cent recorded in Q1 2025.

The figures signal a strengthening economy, driven by recent rebasing, rebound in oil production and a resilient non-oil sector.

The report said, “Following the rebasing of the Gross Domestic Product using 2019 as the base year, previous quarterly GDP estimates were benchmarked to the rebased annual estimates to align the old series with the new rebased estimates

“This procedure provided a new quarterly GDP series, which is compared to the 2025 second quarter estimates. Gross Domestic Product grew by 4.23% (year-on-year) in real terms in the second quarter of 2025.

“This growth rate is higher than the 3.48 per cent recorded in the second quarter of 2024. During the quarter under review, agriculture grew by 2.82%, an improvement from the 2.60% recorded in the corresponding quarter of 2024.

According to NBS, “The growth of the industry sector stood at 7.45% from 3.72% recorded in the second quarter of 2024, while the Services sector recorded a growth of 3.94% from 3.83% in the same quarter of 2024.”

The report said in terms of share of the GDP, “the Industry sector contributed more to the aggregate GDP in the second quarter of 2025 at 17.31% compared to the corresponding quarter of 2024 at 16.79%.”

It added, “In the quarter under review, aggregate GDP at basic price stood at N100,730,501.10 million in nominal terms. This performance is higher when compared to the second quarter of 2024, which recorded an aggregate GDP of N84,484,878.46 million, indicating a year-on-year nominal growth of 19.23%.”

Details later…