Lagos total debt rises 3.13% to N508.8 bln in Dec, owes highest among 36 sub-nationals
By Oludare Mayowa
Lagos, Nigeria’s economic nerve centre total debt rose 3.13 percent to N508.78 billion as of December 2020, from N493.32 billion at the end of September last year, according to the latest data from the National Bureau of Statistics (NBS).
The report put Lagos as the state with the highest debt profile among the 36 sub-nationals, including the federal capital territory, Abuja.
The state accounts for 12.15 percent of the N4.2 trillion debt owed by the 36 states including the federal capital territory as of December last year.
Total debt of the states of the federation rose from N4.19 trillion as of the end of September 2020.
Nigeria states and federal governments have continued to leverage debt to executed capital projects in the face of dwindling revenue from crude oil exports.
While Lagos State debt rose in the three months to December 2020 by 3.13 percent, Rivers State, the second most indebted state debt stood unchanged at N266.93 billion in December from the previous quarter.
Also on the list of the most indebted states is Akwa Ibom with N230.8 billion, which was down from N239.21 billion in the third quarter of last year.
For Delta State, its debt profile rose by 5.33 percent in three months to December 2020 to N248.45 billion from N235.86 billion in September.
Both Cross Rivers and Ondo state accounted for N163.16 billion and N153.49 billion of total debt by sub-nationals as of December 2020.
In January, Lagos said it plans to N192.49 billion from both domestic and external sources to plug the deficit in this year’s budget.
The state said it will issue N100 billion from the domestic bond market, another N41 billion borrowing locally and the balance of N57 billion from foreign lenders.
Lagos plans to spend N1.16 trillion in 2021, with expectations that the bulk of the funding will come from N723.8 billion internally generated revenue while N175.4 billion will comes from the federation accounts.
Defending the huge indebtedness of Lagos State, its commissioner for finance Rabiu Olowo said in January that there is a lot the state needs to do to improve infrastructure in the state.
According got him, debt is good when it is used for capital projects and what is more important is the debt sustainability benchmark of the state, which he considered was in favourable territory.