Nigeria’s Attempt to Restructure 23.7 Trillion Naira ($53 Billion) Debt

Nigeria is making a major move to restructure its debt, seeking to shift its short-term loans owed to its central bank into a 40-year loan with an interest rate of 9%. This comes as the country’s public debt has increased by 3% in the second quarter and its budget deficit to revenue ratio has increased to 74%. As such, President Muhammadu Buhari has recently submitted a letter to Parliament, requesting approval for this transaction. The restructuring of this debt is seen as an effort to make it easier for the country to pay back its loans and reduce the debt burden on the country. It is also seen as a way to help the country’s economy, as it is expected to improve the country’s financial stability and help create more jobs. Clearly, there are also concerns about the restructuring, particularly about the interest rate of 9%, which is higher than the current interest rate. In addition, there are concerns about the ability of the country to pay back the loan in the long term, as the budget deficit to revenue ratio is expected to rise to 111% in 2022.