Is Nigeria a heavily indebted nation?

Is Nigeria a heavily indebted nation?

Aliyu Nuhu

The answer is no. It is the least borrower among nations of its size. The minister of finance said the country’s debt relative to GDP is 19%. IMF figures put it at 27%. I will believe IMF as almost all economic watchers will prefer the IMF figure. Even at that,Nigeria is not a heavily indebted nation.

I always support national borrowing. Debts are good. The important thing is what the debts are used for, and the conditions attached. For now Nigeria is borrowing mostly from China under favourable conditions. The key issue is that the debts are tied to projects and the money goes into the projects direct instead of going through treasury where politicians will steal it.

Before you reject debt remember that the most advanced countries are the most heavily indebted. The least borrowing countries are the most backward. Those countries cannot even secure debts.

To understand the benefits of Nigeria’s debt take a look at Abuja-Kaduna railway or Lagos-Ibadan railway. They are financed by debts. The Chinese that financed it will operate it for five years to recover the loan and leave the railway with us. Good or bad debt? Answer is good debt.

Another example is new Abuja airport terminal. The Chinese built it and will operate it for five years and transfer it back to us. Good debt!

Now read this.

Debt to GDP Ratio by Country 2019

Japan, with its population of 127,185,332, has the highest national debt in the world at 235.96% of its GDP (although, notably, Japan is also one of the world’s largest economies).

Greece, which is still recovering from the effects of its economic crisis and subsequent bailout, has national debt per GDP ratio at 191.27%.

Venezuela, which is currently undergoing serious economic difficulties, is also in the top five countries with the highest national debt, with a debt to GDP ratio of 161.99%.

Several African countries also have high national debts, including Sudan (176.49%), Eritrea (129.43%) and Gambia (111.45%).

Of the world’s major economic powers, the United States has the highest national debt at 108.02% of its GDP.

China, the world’s second-largest economy and home to the world’s largest population (1,415,045,928), has a national debt ratio of just 51.21% of its GDP.

Germany, as Europe’s largest economy, also has a relatively low national debt ratio at 59.81%.

Remember Nigeria’s debt is just 27%.

Hong Kong, a major global financial center, has the lowest national debt in the world, at just 0.05% of its GDP.

This is followed by the tiny Kingdom of Brunei with a population of just 434,076 and a national debt of 2.49% of its GDP

Now the full picture for reference:

National Debt to GDP Ratio

Japan 234.18% 126,854,745

Greece 181.78% 11,124,603

Sudan 176.02%

Venezuela 172.08% 32,779,868

Lebanon 160.57% 6,065,922

Italy 127.51% 59,216,525

Eritrea 127.34% 5,309,659

Barbados 127.31% 287,010

Cape Verde 126.66% 560,349

Portugal 117.54% 10,254,666

Mozambique 116.60% 31,408,823

United States 109.45% 329,093,110

Singapore 108.79% 5,868,104

Gambia 105.17% 2,228,075

Republic of the Congo 105.01% 5,542,197

Bahrain 102.01% 1,637,896

Belgium 99.08% 11,562,784

France 96.20% 65,480,710

Bhutan 96.05% 826,229

Yemen 95.83% 29,579,986

Belize 95.53% 390,231

Spain 95.12% 46,441,049

Jamaica 93.99% 2,906,339

Jordan 90.83% 10,069,794

Brazil 90.24% 212,392,717

Antigua and Barbuda 90.23% 104,084

Cyprus 89.52% 1,198,427

Dominica 87.25% 74,679

Egypt 87.08% 101,168,745

United Kingdom 85.92% 66,959,016

Canada 83.81% 37,279,811

Saint Vincent and the Grenadines 81.23% 110,488

Ukraine 76.86% 43,795,220

Sri Lanka 75.19% 21,018,859

Saint Lucia 74.91% 180,454

Tunisia 73.31% 11,783,168

Mauritania 73.17% 4,661,149

Maldives 72.82% 451,738

Zimbabwe 72.64% 17,297,495

Croatia 72.58% 4,140,148

Sao Tome and Principe 72.16% 213,379

Austria 71.97% 8,766,201

Angola 71.59% 31,787,566

Togo 70.57% 8,186,384

Slovenia 69.80% 2,081,900

Burundi 69.45% 11,575,964

Albania 68.50% 2,938,428

Zambia 68.04% 18,137,369

Suriname 67.73% 573,085

Pakistan 67.44% 204,596,442

India 67.29% 1,368,737,513

Laos 66.71% 7,064,242

Montenegro 66.50% 629,355

Puerto Rico 66.02% 3,654,978

Ghana 65.90% 30,096,970

Hungary 65.87% 9,655,361

Uruguay 65.17% 3,482,156

Ireland 64.86% 4,847,139

Sierra Leone 63.99% 7,883,123

Morocco 62.44% 36,635,156

Nauru 61.69% 11,260

Israel 61.38% 8,583,916

Finland 59.56% 5,561,389

Gabon 59.34% 2,109,099

Mauritius 59.11% 1,271,368

El Salvador 58.83% 6,445,405

Senegal 58.75% 16,743,859

Namibia 58.52% 2,641,996

Vietnam 58.13% 97,429,061

Malawi 57.59% 19,718,743

Saint Kitts and Nevis 57.55% 56,345

Bahamas 56.95% 403,095

Kenya 56.95% 52,214,791

Grenada 56.72% 108,825

Ethiopia 56.70% 110,135,635

Azerbaijan 56.37% 10,014,575

Guyana 56.12% 786,508

Costa Rica 55.92% 4,999,384

Germany 55.75% 82,438,639

South Africa 55.70% 58,065,097

Armenia 55.58% 2,936,706

Serbia 55.09% 8,733,407

Kyrgyzstan 55.08% 6,218,616

San Marino 54.61% 33,683

China 54.44% 1,420,062,022

Iraq 54.44% 40,412,299

Seychelles 53.68% 95,702

Mexico 53.43% 132,328,035

Argentina 52.75% 45,101,781

Benin 52.64% 11,801,595

Malaysia 52.62% 32,454,455

Bolivia 52.31% 11,379,861

Qatar 51.96% 2,743,901

Vanuatu 51.70% 288,017

Netherlands 50.91% 17,132,908

Ecuador 50.05% 17,100,444

Belarus 49.93% 9,433,874

Tajikistan 49.88% 9,292,000

Poland 49.80% 38,028,278

Iran 49.21% 82,820,766

South Sudan 48.58% 13,263,184

Equatorial Guinea 48.41% 1,360,10

Oman 48.34% 5,001,870

Colombia 48.17% 49,849,818

Niger 47.53% 23,176,691

Ivory Coast 46.87% 25,531,083

Fiji 46.86% 918,757

Slovakia 46.56% 5,450,987

Samoa 46.25% 198,909

Malta 45.94% 433,245

Chad 45.39% 15,814,345

Guinea 44.69% 13,398,180

Trinidad and Tobago 44.67% 1,375,443

Uganda 44.51% 45,711,874

Central African Republic 44.37% 4,825,711

Georgia 44.09% 3,904,204

Honduras 44.08% 9,568,688

Rwanda 43.12% 12,794,412

Macedonia 42.22% 2,086,720

Moldova 41.99% 4,029,750

Lesotho 41.74% 2,292,682

Thailand 41.58% 69,306,160

Burkina Faso 41.34% 20,321,560

Switzerland 41.10% 8,608,259

Australia 41.05% 25,088,636

Swaziland 40.97% 1,415,414

Tanzania 40.72% 60,913,557

Liberia 39.12% 4,977,720

Romania 38.96% 19,483,360

Algeria 38.42% 42,679,018

Bosnia and Herzegovina 38.38% 3,501,774

South Korea 38.27% 51,339,238

Madagascar 38.02% 26,969,642

Dominican Republic 37.87% 10,996,774

Guinea-Bissau 37.59% 1,953,723

Panama 36.97% 4,226,197

Norway 36.66% 5,400,916

Mali 36.58% 19,689,140

Philippines 36.28% 108,106,310

Cambodia 36.19% 16,482,646

Denmark 35.06% 5,775,224

Iceland 34.88% 340,566

Myanmar 34.87% 54,336,138

Nicaragua 34.58% 6,351,157

Sweden 34.45% 10,053,135

Haiti 34.27% 11,242,856

Cameroon 34.06% 25,312,993

Turkmenistan 33.62% 5,942,561

Bangladesh 33.36% 168,065,920

Kiribati 32.88% 120,428

Kuwait 32.42% 4,248,974

Latvia 31.92% 1,911,108

Taiwan 31.83% 23,758,247

Tuvalu 31.49% 11,393

Lithuania 31.41% 2,864,459

Czech Republic 31.29% 10,630,589

Papua New Guinea 30.67% 8,586,525

Indonesia 30.25% 269,536,482

Djibouti 29.33% 985,690

Nepal 28.83% 29,942,018

Comoros 28.48% 850,910

Peru 28.01% 32,933,835

Turkey 27.86% 82,961,805

Nigeria 27.37% 200,962,417

Paraguay 26.06% 6,981,981

Guatemala 24.64% 17,577,842

Chile 24.62% 18,336,653

Saudi Arabia 23.83% 34,140,662

Marshall Islands 23.25% 53,211

Kazakhstan 23.14% 18,592,970

Bulgaria 22.86% 6,988,739

Luxembourg 22.80% 596,992

New Zealand 22.69% 4,792,409

Uzbekistan 20.65% 32,807,368

Micronesia 20.55% 106,983

Russia 19.48% 143,895,551

United Arab Emirates 19.35% 9,682,088

Solomon Islands 16.41% 635,254

DR Congo 13.31% 86,727,573

Botswana 12.84% 2,374,636

Estonia 8.12% 1,303,798

Afghanistan 6.32% 37,209,007

Brunei 2.46% 439,336

Source

1-IMF data from World Economic Outlook database.

2- World Population Review