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…. As CBN Injects $4.37bn into Foreign exchange market
Lagos and the four Niger Delta states of Rivers, Akwa Ibom, Cross River and Delta are the biggest debtors in the country, figures from the Debt Management Office, DMO showed.
The total debts owned by the sub national government including the Federal Capital Territory, FCT Abuja stood at N4.19tn.
In its third-quarter report of 2020, the DMO stated that domestic debt by states and the FCT rose to N4.19tn, which represents 20.91 per cent of the nation’s local debt profile of N20.04tn as of Q3 2020. The DMO further revealed that this figure jumped from N19.65tn in the previous quarter.
A peep at the DMO data showed that the domestic debt by states government soared by N484.24m in Q3 2020.
An in-depth look at the statistics by the DMO, the domestic debt of the Federal Government surged by N390bn to N15.85tn. It must however be stated that this data excludes the foreign debts profile of the country which currently stands at a whopping N31. 01 trillion, ($85.9 billion).
A state by state assessment of the data showed that Lagos, Delta, Rivers, Cross River and Akwa Ibom alone have a combined debt of N1.40tn, representing 33.41 per cent of the total domestic debt owed by the second tier of governments in the country as of September 30, 2020.
The N493.32bn as of Q3 2020 owed by Lagos State represents 11.77 per cent of debt by the 36 states and the FCT.
Rivers followed with N266.94bn, representing 6.37 per cent, Akwa Ibom is third at N239.21bn, representing 5.71 per cent, then come Delta at N235.86bn representing 5.63 per cent.
While Cross River has a domestic debt of N164.10bn., representing 3.92 per cent.
Imo, Ogun, Bayelsa, Osun, Benue and Plateau are states with huge domestic debt profile, with N158.17bn, N150.09bn, N147.89bn, N134.89bn, N128.50bn and N127.01bn respectively.
Taraba, N122.75bn; Kano, N116.99bn; Adamawa, N116.89bn; and Oyo, N99.94bn all closely followed.
Yobe, with a debt of N29.23bn, topped the states with least debt profile, Jigawa, N36.04bn; Ebonyi, N41.27bn; Katsina, N44.42bn; and Sokoto, N48.09bn.
Others are Anambra, N59.01bn; Nasarawa, N61.29bn; Enugu, N62.44bn; Kwara, N63.37; and Niger, N65.60bn.
CBN Injects $4.37bn into Foreign exchange market Meanwhile, the Central Bank of Nigeria (CBN) has injected $4.37bn into the foreign exchange market in the third quarter of 2020.
The apex bank in its third-quarter economic report for 2020 said this was as part of efforts to ensure the stability of the nation’s currency.
The naira has been declining against other foreign currencies hovering around 450-480 to 1USD, even hitting the 500 per dollar mark in late November 2020.
But according to the CBN, it stated that its periodic interventions in the forex market, it continued to boost the supply side of the market, as Covid-19 crisis weakened the private sector supply chain segment of the market.
The report reads in part, “During the third quarter of 2020, total foreign exchange sales to authorised dealers by the bank amounted to $4.37bn, a decline of 2.3 per cent from the level in the preceding quarter.
This was attributed largely to the decrease in wholesale forward intervention and interbank sales. The total foreign exchange sales represented a decrease of 56.4 per cent, compared with the corresponding quarter of 2019.”
It added, “Further disaggregation showed that matured swap transactions and SMIS intervention rose by 50.8 per cent and 0.7 per cent to $1.24bn and $1.96bn, from the levels in the preceding quarter.
“However, interbank sales, interventions at the I&E window and SME fell by 22.3 per cent, 18.7 per cent and 3.5 per cent to $0.15bn, $0.39bn and $0.30bn relative to their levels in the preceding quarter.”