13 Nigerian States Spend N243.2Billion On Debt Charges In 9 Months Amid Developmental Challenges
According to the data, the highest debt charges was spent by Ondo State.
A recent review by SaharaReporters of budget performance documents from 13 select states revealed that a staggering N243.2 billion was allocated towards public debt charges in just the first nine months of 2024.
According to the data, the highest debt charges was spent by Ondo State.
Ondo State spent N64.6 billion on debt charges, Oyo spent N20.5 billion, Yobe’s debt charges gulped N9.2 billion; Kogi, N18.1 billion; Taraba, N21.1 billion and Ekiti, N12.9 billion.
Katsina, N12.7 billion; Rivers, N42 billion; Osun, N15.3 billion; Jigawa, N2.1 billion; Kwara, N9.3 billion; Anambra, N4.5 billion and Abia, N10.9 billion.
Debt charges, which refer to the interest paid on loans taken by state governments, have reached alarming levels, with billions spent in just the first nine months of 2024.
This trend is particularly concerning given the existing development challenges across various states. Experts have long argued that the massive funds allocated to debt charges divert essential resources away from critical development projects, hindering states’ progress.
In fact, a recent report by the World Bank revealed that developing countries paid a record $443.5 billion in public debt in 2022, with interest payments consuming a significant share of low-income countries’ export earnings. This situation is exacerbated by high interest rates, which have intensified debt vulnerabilities in all developing countries.
Nigerian states are facing a severe revenue crisis, forcing them to rely heavily on loans, which in turn leads to staggering debt charges.
This vicious cycle hinders the states’ ability to address pressing issues like inadequate water supply, healthcare, and crumbling road networks.
To put this into perspective, Ondo State’s debt charges reached an alarming N64 billion in the first nine months of 2024 – that’s about three times its internally generated revenue of N24.4 billion.
What’s more, this amount surpasses the N19 billion allocated to the state’s ministry of works and infrastructure capital expenditure.
While Ondo State spent N141 million on capital expenditure for water resources, public sanitation and hygiene, it spent N64 billion on public debt charges.
Ondo State also suffers from issues such as flooding which has affected many lives and properties.
It also has a household population of 66% lacking access to sanitary facilities, while 51% of households in the state lack access to clean drinking water.
Ondo State’s budget for rehabilitating boreholes was a mere N100 million, but shockingly, the state spent a whopping 640 times that amount – N64 billion – on debt charges alone.
