Nigeria’s rising foreign debts rattles investors

The number of foreign investors and analysts are beginning to raise concerns about the cost of Nigeria’s debt and how the proceeds of bond sales are utilised.

Financial Times reports that some investors are still willing to invest in Nigeria because of the high returns.

Andrew Roche, managing director of Finexem, a Paris-based financial consulting firm, told Financial Times that the government has been using borrowed funds to patch up holes in the budget rather than investing in infrastructure.

“They have borrowed quite a bit, but where is the money being spent?” he said.

However in her address to investors at the spring meetings of International Monetary Fund and World Bank Group, Zainab Ahmed, the minister of finance(pictured), had said the country’s debt is 19% of the 2018 GDP.

Also, the same presentation had shown that debt servicing now takes two-thirds of the revenue retained by the federal government after the federation account allocation committee (FAAC) shares revenues to the three tiers of government.