In the first six months after taking office, 13 new state governors collectively borrowed N226.8bn from domestic and external financiers.
The Debt Management Office noted that 16 state governors also increased the debt profile of their states by N509.3bn with domestic and external debt of N243.95 billion and $298.5 million (N265.37bn), respectively.
The external debt was calculated based on the exchange rate of N889/$ used by the Debt Management Office in its report.
This is according to an analysis of the latest sub-national debt reports released by the DMO.
The sub-national debts are classified into domestic borrowings from local creditors and external borrowings from international creditors like the World Bank and the International Monetary Fund.
The domestic and external debts published on the DMO’s website were as of December 30 and June 30, 2023, respectively.
The states, which include Benue, Cross Rivers, Katsina, Niger, Plateau, Rivers, Zamfara, and the Federal Capital Territory, got N115.57 billion from domestic creditors, while governors of Ebonyi, Kaduna, Kano, Niger, Plateau, Sokoto, Taraba and Zamfara States borrowed $125.1 million (N111.24bn) from external sources.
For the sub-nationals, a further breakdown of the data showed that Cross Rivers Governor, Bassey Otu, took the highest loan, with N16.2 billion from domestic and $57.95m from foreign creditors between June and December 2023.
Katsina State followed with the debt surging by N36.93 billion from N62.37bn to N99.3 billion by December 2023.
Third on the list is Niger State, with a domestic debt of N17.85 billion, surging from N121.95 billion in June 2023 to N139.8 billion by December of the same year.
Plateau got N16.32 billion; Rivers borrowed N7.07 billion; Zamfara, N14.26 billion; and the FCT under the leadership of Nyesom Wike borrowed N6.75 billion from domestic creditors.
For foreign debt, Governor Francis Nwifuru of Ebonyi State accumulated external debt of $37.54 million, while Governor Uba Sani of Kaduna State borrowed $17.69 million from external financiers.
Similarly, the governors of Kano borrowed $6.6 million; Niger, $1.27 million; Plateau, $831,008; Sokoto, $499,472; Taraba, $1.51m; and Zamfara, $655,563, from external sources.
Despite declarations by the administration of President Bola Tinubu that it would not continue with the massive borrowings of the previous government to fund its expenditures, the latest developments show that the new government is sticking to the controversial policy amidst increased revenue.
In 2023, state governors got the most Federal Account Allocation Committee allocations in at least seven years.
The rise in FAAC allocations to the three tiers of government, especially the states, followed the removal of subsidy on petrol and currency reforms by the Tinubu administration. The reforms have reportedly led to a 40 per cent boost in income.
An analysis of the 2023 FAAC monthly allocations revealed that the sub-national and local government councils got the highest allocation of N627.73 billion in September, followed by N610.5 billion in December, N555.75 billion in August, N533 billion in November, N514 billion in July and N497.97 billion in October.
