As of the most recent data by debt management office, Benue state is the highest indebted Northern state domestically, a WikkiTimes review has shown.
This is followed by Plateau with a debt profile of N169 billion, while Bauchi follows the pack with N162 billion debt.
The state with the lowest debt profile is Jigawa with N43 billion.
Kaduna Owes Highest External Debt in Northern Nigeria
A further review has shown that Kaduna is the most indebted in terms of foreign debt portfolio in the North. The state owes $569 million.
Bauchi again is the second most indebted state in the North with a profile of $170 million.
Borno owes the least external debt with $19 million.
The Problem of Debt and the Heavy Load on Domestic Financial Institutions
There have been consistent worries on the growing debt profile of states in the country. Already, experts have warned that growing debt will harm development in the country. They noted that chuck of revenue made usually goes into debt service.
A WikkiTimes report revealed how Bauchi spent 70% of its internally generated revenue on debt service in 2023.
Kano also spent 23% of its 2023 IGR on debt servicing. In 2023, the state made N41 billion internally and spent N9.5 billion on public debt transactions.
Kogi spent N17.6 billion debt servicing in 2023. This would mean that the state spent 74.5% of its IGR on debt service, this is as it recorded N23.6 billion IGR in 2023.
In 2022, Kogi state spent the sum of N25.20 billion on debt service , despite making only N17 billion IGR in the same year.
A high percentage of loans by these states comes from domestic sources, that is, banks.
WikkiTimes did a check on the financial statements of banks.
Banks continue to feed Government
For Access Bank, as of half year 2022, the loan to the government stood at N415 billion , representing 7.7% of the total loan it issued out for that period of time.
As of the half year of 2023, the loans disbursed by Zenith bank to the government stood at N731 billion, representing 13.6% of the total loan by the bank as of that period.
Government took 10.2% of the loan disbursed by the United bank for Africa as of half year 2023, with a total N470 billion.
Fiscal mismanagement has also been blamed for the debt profile in the country.
In 2023, SERAP asked the World Bank to suspend loans to Nigerian states citing diversion of funds and how the monies gotten as loans by these states are spent.
While it has been noted that the Nigerian fiscal responsibility act permits loans for capital needs, reports have it that Nigerian states borrow to pay salaries.
States have struggled with revenue generation , relying on loans to fund their budget.
