Nigeria has attained another dubious global ranking with its debt service ratio now judged to be the highest in the world by the Economist Intelligence Unit (EIU), IgbereTV reports
The EIU is the research and analysis division of the Economist Group, providing forecasting and advisory services through research and analysis, such as monthly country reports, five-year country economic forecasts, country risk service reports, and industry reports.
Analysts at the EIU in a global note to investors on Wednesday said the staggeringly high 118.9 percent debt service/revenue ratio from January to April was the worst in the world and underlines unsustainable fiscal policy.
The report said: “Nigeria’s federal government debt service payments in the first four months of 2022 totalled N1.9trn, which was greater than its total revenue of N1.6trn, according to the 2023‑2025 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) draft presented by the finance, budget and national planning minister, Zainab Ahmed, on July 21st.
“It confirms that Nigeria’s fiscal position is untenable, despite high international oil prices. We consider both subsidy and tax reform as inevitable in the medium term.” On the back of this, the EIU said Nigeria’s deficit for 2022 could now be expected to top 6 percent of GDP.”
Nigeria already has the highest number of out of school children in the world and years ago, it was awarded the inglorious label of poverty capital of the world on account of its burgeoning population of absolute poor.
