Nigeria Owes China $3bn, Says World Bank

The total amount of money owed to the Chinese government by the Federal Government as at March last year rose to $3. 121 billion (N1,126.68 trillion at USD/N361). The amount represents only 3.94 per cent of Nigeria’s total public debt of $79.21 billion as at September 2021.

Similarly, in terms of external sources of funds, loans from China accounted for 11.28 per cent  of the External Debt Stock of USD27.67 billion as at the same date.

According to document from World Bank, the  total borrowing from China of USD3.121 billion as at March 31, 2020, are concessional loans with interest rates of 2.50 per cent per annum with a  tenor of 20 years and grace period (moratorium) of seven  years.

“These terms are compliant with the provisions of Section 41 (1a) of the Fiscal Responsibility Act, 2007. In addition, the low interest rate reduces the interest cost to government while the long tenor enables the repayment of the principal sum of the loans over many years. These two benefits, make the provisions for debt service in the annual budget lower than they would otherwise have been if the loans were on commercial terms” the document, said.

-Sunnews