The World Bank has rated Nigeria as number 5 in a list of top 10 countries with high debt risk exposure. This is contained in a fiscal year financial statement for international Development Association (IDA), a World Bank institution that grants concessional loans to poor countries.
The report said Nigeria have borrowed $11.7 billion (about N4.816 trillion) making it fifth highest borrower from the World Bank Group.
The top ten developing countries with high debt risk exposure include: India with $22 billion, Bangladesh ($18.1 billion), Pakistan ($16.4 billion), Vietnam ($14.1 billion), Nigeria ($11.7 billion). Others are Ethiopia ($11.2 billion), Kenya ($10.2 billion), Tanzania ($8.3 billion), Ghana ($5.6 billion), and Uganda ($4.4 billion).
Nigeria’s $11.7bn or is estimated close to one third of the nation’s 2021 national budget, which is placed at N13.6tr. These implies that every citizen of Nigeria owes the World Bank a minimal sum of N24,000 if the debt is distributed individually across the entire population of Nigeria.
The financial statement said, “IDA faces two types of credit risk: country credit risk and counterparty credit risk.
The report also stated that “for Fiscal Year 2022 (FY22), the single borrower limit (SBL) has been set at $45 billion (25 percent of $180.9 billion of equity as of June 30, 2021), marginally higher than FY21,”.
“As of June 30, 2021, the ten countries with the highest exposures accounted for 66% of IDA’s total exposure.
“Monitoring these exposures relative to the SBL, requires consideration of the repayment profiles of existing loans, as well as disbursement profiles and projected new loans and guarantees.”
The financial statement for IDA disclosed that Nigeria had a total undisbursed balance of $8.07bn, consisting of $1.462bn loans approved but not yet signed and $6.61bn signed loan commitment.
