DMO, in its latest analysis of the country’s debt burden in 2022, said for Tinubu to borrow, the government must increase its projected revenue from N10.49 trillion to about N15.5 trillion.
It stated that Nigeria’s Public Debt-to-GDP ratio is projected to increase to 37.1 per cent in 2023, mainly due to new borrowings, FGN Ways and Means at the CBN, and estimated Promissory Notes issuance.
DMO lamented that the projected FGN Debt Service-to-Revenue ratio of 73.5 per cent for 2023 exceeded the recommended threshold of 50 per cent due to low revenue.
This highlights the urgent need to increase government revenue significantly.
The DMO emphasized the importance of adhering to existing legislation on government borrowing, such as the Fiscal Responsibility Act 2007 and the Central Bank of Nigeria Act 2007, to moderate the growth rate of public debt.
Furthermore, the DMO called for a focus on revenue mobilization initiatives and reforms to increase the Country’s tax revenue to GDP ratio.
It also suggested encouraging private sector involvement in funding infrastructure projects through Public-Private Partnerships (PPP) and reducing borrowing by privatizing or selling government assets.
The DMO’s warning serves as a reminder of the challenges posed by Nigeria’s high debt burden.
