as well as debt servicing and sinking fund required to service Nigeria’s debt in 2024 may rise by 48.38 per cent.• CBN Must Deepen Trust For Its Policies To Gain Root – Abubakar
Then there is another provision of N7,828,529,477,860 for debt financing. Cumulatively, the amount involved in debt settlements comes to N16,099,490,084,691 only.
In February 2024, the Nigerian headline inflation rate rose to 31.70 per cent, up from 29.90 recorded in January. Comparatively, on an annual basis, February’s inflation rate was 9.79 per cent higher than the 21.91 per cent recorded in February 2023. However, the naira has been on an upward trajectory exchanging for N1,187.742 as of yesterday . So, going by the exchange rate, the 2024 budget benchmark, which is N800 to the dollar, is short of N387.
At the N1,187 exchange rate currently, the Federal Government may be considering tampering with the fundamentals of the budget, especially as the costs of projects have since moved more than double. He noted that when inflation is growing month-on-month, the first step to be taken is to stop the growth, make it steady over a period and then begin to hit harder on reducing it. He maintained that exchange rate volatility is one of the major drivers of inflation in the country.
He held that though the monetary authorities could be seen to be doing all they can to jumpstart the economy, the fiscal side seems asleep with no direction on how to generate enough inflow to bolster the efforts of the monetary side. He stated that the revaluation losses from naira devaluation on external loans that have a 62 per cent multilateral and bilateral creditor’s component would impact the debt servicing and refinancing component, especially its ratio to capital expenditure