The Organisation of the Petroleum Exporting Countries (OPEC) Tuesday said Nigeria’s monumental cost of servicing debts could stand in the way of economic productivity.
Nigeria has been accumulating debts in recent times to fund infrastructural projects because oil receipts into Africa’s biggest economy have been coming in dribs and drabs following an oil crash and now has its eyes set on the approval of a further $3 billion lifeline intended for budget support to fund its spending plan for this year.
OPEC noted in its Monthly Oil Market Report that its direct communication with Nigeria revealed that the country’s oil output for the dipped from 1.44 million barrels per day (bpd) in May to 1.41 million in June.
Nigeria’s public debt ramped up by 15 per cent year on year to $79.3 billion at the end of March 2020, OPEC stated, citing a funding gap occasioned by slump in internal revenue and weaker oil prices.
The oil cartel maintained that even though country’s the debt to the Gross Domestic Product of 20 per cent was modest by international standards, its debt to revenue ratio was high due to fiscal constraints.
Nigeria’s outputs based on OPEC’s direct communication with the country were 1.76 million bpd in the first quarter and 1.52 million in the second quarters of 2020.
The average output of the group’s 13 members came to 22.27 million bpd in June. 1.89 million barrels lower month on month.