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CBN pays $4.45 billion external debt to World Bank, others in 2-month

Latest data obtained from the CBN reveals that Nigeria paid a whopping sum of $4.45 billion as external debt service/payment in the first two months of 2020.



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Debt servicing may constitute a major setback for the Nigerian economy in the year 2020, as the latest data obtained from the Central Bank of Nigeria revealed that Nigeria paid a whopping sum of $4.45 billion as external debt service in the first two months of 2020.

According to the data obtained from the CBN covering January and February 2020, the sum of $4.45 billion was paid Year-to-Date (YTD) in 2020 as external debt service, representing a 240% rise compared to the cumulative total debt service payment recorded in 2019.

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Debt Service payment hits all-time high

In 2019, the CBN record showed that a total sum of $1.34 billion was paid as external debt service payment. Meanwhile, a closer look at the CBN data showed the sum of $125.4 million was recorded in January, while $4.43 billion in February 2020.

A closer look at the historical trend of external debt service showed that the $4.55 billion paid in February 2020 to service external debt represents the biggest single tranche of payment recorded in Nigerian debt history.

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[READ MORE: Nigeria spends $1.31 billion to service external debt in 2019)

It should be noted that Nigeria is obligated to pay lump sum as external debt obligations to various world organizations like World Bank, African Development Bank, Exim Bank of China, Exim Bank of India and so on. Data from the Debt Management Office (DMO) shows that Nigeria paid over $134.3 million to the World Bank in just Q3 2019.

External debt rose by 616% in 14 years

External debt service continues to hit deep on Nigeria, and this is due to the rising external debt accumulation. Following the successful Paris Club debt deal and the exit from the London Club debts, Nigeria’s external debt stock dropped to US$3.54 billion in 2006. Fast forward to 2019, the country’s external debt rose to $26.94 billion, representing 616% rise in 14 years.

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At the end of Q3 2019, data obtained from the DMO database showed that the country’s total debt stock stood at $85.39 billion. Since 2006, Successive government in Nigeria have approached both local and foreign debt market obtain loans to finance their operations.

In terms of GDP, the country’s debt to GDP ratio remains relative sustainable for now at c.18% based on latest DMO debt data, however, the cost of servicing the debt may further put Nigeria in difficult financial strain. In 2019, debt servicing gulped over 50% of the country’s total revenue.

Foreign Reserves extend free fall as revenue source plunge

The outlook for Nigeria’s revenue in 2020 faces a huge problem as the country’s main revenue source (Oil) currently trades at a twenty-year low of $28pb. It should be noted while the drop in oil price significantly affects Nigeria in terms of revenue, debt service obligations is paid regardless and this is sometimes moved from the foreign reserves.

In 2019 (YTD), the foreign reserves dropped by $2.36 billion, a decline that has been largely attributed to the continued fall in oil price due to global headwinds arising from Pandemic COVID 19 and oil price war between one of the two largest oil producers in the world.

[READ ALSO: Nigeria pays $1.09 billion to service external debt in 9 months)

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What next for the Nigerian economy?

Bearing current realities of revenue crisis, the Nigerian government slashed the price of PMS (Petrol), a move targeted to easing off revenue decline pressure and controversial subsidy payment in the country.

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The continued spread of pandemic COVID continue to dampen growth outlook world over, and Nigeria ranks top among countries suffering worst hit in terms of the trickledown effect.

The Group Managing Director, NNPC, Mele Kyari, recently disclosed that as a result of the coronavirus pandemic, Nigeria has about 50 cargoes of crude oil that have not found a landing and this implies that there are no off-takers for them for now due to the drop in demand.

READ MORE: Debt servicing gulps N7.04 trillion under President Buhari’s administration

Without mudslinging the current administration at the wheel, Nigeria cannot afford more external debt borrowing.  Recall, that the CBN has just embarked on what was described as “exchange rate adjustment or unification”, by collapsing both inter-bank rate and Parallel markets, making them trade at the same rates. While the CBN has said this is not a devaluation, one thing obvious is that this is only an old while in a new bottle. That is, Naira has just been partially devalued.

What it means: With the partial devaluation of naira, it implies for every external debt service obligation Nigeria pays, it will cost more in terms of the dollar value, a luxury Nigeria can no longer afford.


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COVID-19: CACOVID spent N43.27 billion to support 3 key priorities – CBN



CACOVID devotes N23 billion to feed Nigerians

The Central Bank of Nigeria (CBN) has revealed that the Coalition Alliance Against COVID-19 (CACOVID) has so far incurred an expenditure of N43.27billion on the acquisition of, not only medical equipment and supplies but also food palliatives for vulnerable Nigerians.

The recent press release noted that the funds raised by CACOVID was used to support 3 key priorities – Medical facilities and equipment, food relief programs and communications plans.

The breakdown of the expenditure in the aforementioned areas are:

  • Medical Facilities and equipment: In collaboration with other stakeholders, CACOVID developed 39 fully equipped isolation centers across the 36 States of the Country including the Federal Capital Territory (FCT). The sum of N4.19billion was spent in Building Isolation Centers. In addition, medical equipment such as PCR test kits for suspected cases of COVID-19 were procured along with other required medical items at a cost of N9.02billion.
  • Food relief programs: As a way of cushioning the impact of the lockdown on vulnerable citizens, CACOVID provided palliatives in the form of essential food items to 1.7million households, which is equivalent to supporting 8 million Nigerians. A total of N28.76billion was spent procuring these food supplies.
  • Communication plans: CACOVID also worked to improve awareness in rural communities on the COVID-19 virus, and the measures community health workers and other members of society should take when someone in the community is suspected of having symptoms similar to that of COVID-19. In lieu of this, expenses were incurred on Print, TV, radio, and social media as part of CACOVID communication plans.

Why this matters

The recent disclosure is in line with the principle of accountability and transparency, as the organization seeks to lay bare facts regarding expenditure incurred so far; thereby, nipping in the bud, suspicions and unfounded rumor.

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What you should know

Due to the sudden global health challenge (COVID-19), which wreaked havoc on most economies of the world, coupled with declining oil prices and declined government revenue; the Bankers Committee, comprising the Central Bank of Nigeria and the Deposit Money Banks, as well as key stakeholders in the private sector came together to set up an alliance in March 2020, known as the Coalition Alliance Against COVID-19 (CACOVID).

The ultimate objective is working with the government to provide support in areas that would result in improved health and welfare for vulnerable Nigerians.

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PZ Cusson announces retirement of Chairman, Kola Jamodu

PZ has announced the retirement Chief Kola Jamodu as Non-Executive Director and Chairman of the Board of the company.



Kola Jamodu

The Board of Directors of PZ Cussons Nigeria Plc has announced the retirement of Chief Kola Jamodu as Non-Executive Director and Chairman of the Board of the company.

This disclosure was made in a notification signed by the Company’s Secretary, Jacqueline Ezeokwelume, and sent to the floor of the Nigerian Stock Exchange.

According to the notification issued by Mrs. Ezeokwelume, Chief Kola Jamodu will retire as a Non-Executive Director and Chairman of the Board effective 11 December 2020 to enable him to pursue other personal endeavours.

What you should know

Chief Jamodu joined PZ Cussons Group in 1974 and served in Executive positions for 24 years rising to the position of Chief Executive Officer of the Company, a position he held until he retired in 1999.

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He thereafter continued as a Non-Executive Chairman of the Board until 2001 when he was appointed as the Honourable Minister of Industry of the Federal Republic of Nigeria, a position he held until 2003.

He was reappointed as the Chairman of the Board of PZ Cussons Nigeria Plc in November 2014.

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Abbey Mortgage Bank announces appointment of 6 Directors

The Central Bank of Nigeria has approved the appointment of 6 Directors of Abbey Mortgage Bank.



Abbey Mortgage Bank announce the appointment of substantive Managing Director, and 5 Directors.

Abbey Mortgage Bank has announced the appointment of 6 Directors, including Mr. Madu Hamman as the substantive Managing Director.

The disclosure is contained in a notification, signed by the Bank’s Secretary, Geoff Amaghereon Esq. and sent to the Nigerian Stock Exchange market today, as seen by Nairametrics.

What you should know

Five (5) other Directors were appointed by the CBN – 2 Executive and 3 Non-Executive Directors.

The names and portfolios of the Directors are; Mr. Mobolaji Adewumi – Executive Director; Mr. Oladipupo Ayodele Adeoye – Executive Director; Mr. Nonso Okpala – Non-Executive Director; Professor Marius N. Umego – Non-Executive Director; and Brigadier-General John Obasa (rtd) – Non-Executive Director.

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The notice also mentioned that all appointments have been approved by the Central Bank of Nigeria.

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