Debt Sustainability: DMO Allays Fears Over IMF’s Concerns

The Debt Management Office (DMO), has allayed fears over concerns by the International Monetary Fund (IMF) on Nigeria’s debt sustainability.

IMF’s Mission Chief for Nigeria, Ms. Jesmin Rahman, had during a virtual media briefing on its Nigeria’s 2021 Article IV Consultation Staff Report recently observed that Nigeria’s debt sustainability was at risk and causes a great deal of concern and unease in the long-term.

The IMF also projected that the federal government could spend as much as 92.6 per cent of its revenue on debt servicing in 2022.

Reacting to the IMF’s position in a statement issued on Saturday, the DMO noted that while the reports by the IMF and Agusto and Co. that Nigeria’s debt levels and debt service levels had grown over the years may be the case, “these reports have failed to consider the challenges experienced by Nigeria in recent times such as two recessions, sharp drop in revenues and security challenges.”

The DMO added: “Even more, the analysis do not acknowledge the improvements in infrastructure which have been achieved through borrowing, as well as, the strong measures by the government to grow revenues”

The debt management agency stated that it was re-iterating the fact that the government is already implementing policies towards increasing revenues and developing infrastructure through public private partnership arrangements, both of which will improve debt sustainability.

The DMO also noted that the Nigerian government has active and regular engagements with the IMF on borrowing and debt management.