The Federal Government’s Promissory Notes debt had risen to N1.65 trillion in June 2024, reflecting a 6.5% increase from March 2024.
This marks a significant 114% rise since President Bola Tinubu took office.
Promissory Notes are a form of domestic debt where the government issues a written commitment to repay a specific amount at a later date.
They have become a key tool for the government to meet financial obligations when immediate revenue or cash is insufficient.
This growing reliance on Promissory Notes underscores the country’s fiscal challenges.
Nigeria’s domestic and foreign public debt reached N71.2 trillion and $42.9 billion, respectively, according to the Debt Management Office’s 2024 half-year report.
This marks a notable increase from December 2023, when domestic debt was N59.1 trillion and foreign debt stood at $42.4 billion, reflecting a 20.4% rise in domestic debt and a 1.1% increase in foreign debt.
The surge in domestic debt, in particular, has been significant under President Bola Tinubu’s administration, rising from N54.1 trillion in June 2023 to the current N71.2 trillion.
A key contributor to this increase has been Promissory Notes, which accounted for N780 billion of the total domestic debt as of June 2023.
A report from the Central Bank of Nigeria attributed the increase in Promissory Notes as of December 2023 to incentives owed to exporters under the Export Expansion Grant scheme, a commitment that predates President Tinubu’s administration.
While the specific causes of the N342.6 billion rise in Promissory Notes in 2024 were not provided, research by findings suggests that the increase may be connected to outstanding debts owed to government contractors, suppliers, and oil marketers.
