Nigeria’s public debt hits ₦46.3trn in 2022

Nigeria's public debt has surged to ₦46.3 trillion in 2022, with a significant portion attributed to new borrowings to fund budget deficits and other liabilities. The country's total debt stock saw an increase of about 6.7 trillion naira between 2021 and 2022, raising concerns about the sustainability of the rising debt levels. Chamberlain Pitterside, the Chief Executive Officer of Exelon Capital Advisors, shed light on the key drivers fueling the share distribution of this debt during a recent interview on CNBC Africa. Pitterside highlighted the issuance of promissory notes and other financial instruments as key contributors to the escalating debt stock. The implementation of these mechanisms has led to a substantial uptick in Nigeria's debt burden, raising questions about the long-term implications for the country's economic stability. One of the critical questions raised during the interview was Pitterside's thoughts on the new plan for Environmental, Social, and Governance (ESG) initiatives. With ESG considerations becoming increasingly prominent in the global financial landscape, Nigeria's approach to sustainability and responsible investing has garnered attention. Pitterside emphasized the importance of aligning ESG goals with the country's overall economic strategy and urged stakeholders to prioritize environmental and social considerations alongside financial objectives. The conversation also delved into the projections for ESG in 2023 and beyond. Pitterside underscored the need for robust ESG frameworks that address pressing environmental and social challenges while facilitating sustainable economic growth. As Nigeria navigates its debt landscape and explores avenues for fiscal sustainability, integrating ESG principles into financial decision-making is poised to play a pivotal role in shaping the country's economic trajectory. In addressing the potential risks associated with Nigeria's mounting debt, Pitterside emphasized the importance of exploring alternative solutions to mitigate adverse impacts on vulnerable segments of the population. With unemployment rates exceeding 40% nationally and youth unemployment reaching alarming levels, the removal of subsidies and other economic reforms must be accompanied by targeted support measures to shield the most vulnerable citizens from financial shocks. Looking ahead, Pitterside alluded to the looming specter of additional public debt, with projections indicating a potential surge to 50-80 trillion naira in the foreseeable future. The evolving debt landscape necessitates a proactive approach to debt management and economic governance to safeguard Nigeria's financial stability and ensure sustainable growth. As Nigeria grapples with its escalating public debt and seeks to balance fiscal imperatives with social welfare priorities, stakeholders face a complex policy landscape that demands thoughtful and strategic decision-making. The path forward hinges on fostering dialogue among diverse stakeholders and charting a course that balances economic growth with social inclusion and environmental sustainability. With public debt levels on the rise, the imperative for prudent fiscal management and sustainable economic policies has never been more pressing.