The Director General of the Debt Management Office, Patience Oniha, has said that high debt levels lead to high debt services and affect investment in infrastructure.
This is according to a document by her, which was presented during a workshop for civil society organisations organised by the SFTAS programme coordination unit held in Abuja on July 15, 2022.
According to the DMO DG, “High debt levels lead to heavy debt service which reduces resources available for investment in infrastructure and key sectors of the economy.”
In the document, she stressed the need for debt sustainability, which she defined as the ability to service all current and future obligations, while maintaining capacity to finance policy objectives without resort to unduly large adjustments or exceptional financing such as arrears accumulation, debt restructuring, which could otherwise compromise its stability.
She added that, “A country’s public debt is considered sustainable if the government is able to meet all its current and future payment obligations without recourse to exceptional financial assistance or going into default.”
However, despite the high debt service, the DMO has constantly insisted on the sustainability of Nigeria’s rising debt, using the debt to Gross Domestic Product ratio as justification.