To ensure that power companies and gas producers have sufficient funds to sustain power generation, according to the World Bank, The Nigerian government has borrowed a total of N1.3 trillion from 2017 to date.
According to the report, the power sector in Nigeria will cost the Muhammadu Buhari-led government an additional than N3 trillion through 2023 if its revenue does not increase.
The report said, “To ensure that Gencos and gas suppliers receive enough payments to continue generating electricity since 2017 the FGN has borrowed a total of N1.3tn ($4.2bn).
“In 2019 total FGN support reached N524bn ($1.7bn), 0.4 percent of GDP – higher than the N428bn budget for health and just 20 percent less than the N650bn budgeted for education.”
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Although all six power generating companies and 11 distribution companies have been sold to private investors, the government is still assisting them, the bank said.
According to the report, the government, through the Nigeria Electricity Regulatory Commission, is setting tariffs for the sector instead of letting the market determine the price.
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What does Nigeria currently owe China? As of December 2020, the most recent official data available, Nigeria’s public debt was N32.9 trillion, or $86.3 billion. This is according to the country’s debt management office.
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