This is not the first time the International Monetary Fund, IMF is expressing concern over Nigeria’s rising debt profile.

But the Nigerian government always found a way to deflate any such fears citing debt to Gross Domestic Product, GDP, which is still relatively low.

The IMF has acknowledged this fact but is still skeptical that the country has the capacity to repay its rising debts.

On Monday, the IMF expressed concern over Nigeria’s capacity to repay its debts and stressed the need for the government to mobilise more revenues domestically.

IMF Senior Resident Representative and Mission Chief for Nigeria, Amine Mati, said during a public presentation of the Spring 2018 Issue of the Regional Economic Outlook for Sub-Saharan Africa, that “the number of countries in debt distress has increased.

From six countries in 2014 to eight in 2015, to 10 in 2016, and today 15 countries. These are low-income economies.

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“Now, I know the question that is going to come from here is: Where is Nigeria? Nigeria is not considered a low-income economy. Nigeria’s debt stock figure, which is 20 to 23 per cent of Gross Domestic Product, is still quite low by any standard. The issue is capacity to repay the debts. So, interest payment to revenue is an issue.”

On the need to ramp up domestic revenue mobilisation, Mati put Nigeria’s total revenue at 6% of GDP.

“There is a lot that can be done to increase revenue very quickly,” he said.

He noted that that Value Added Tax, VAT rate had been quite low in Nigeria, and added that doubling the compliance on VAT from 25 to 50% would increase the VAT ratio from 0.9% of GDP to 2%.

Nigeria’s debt stood at 21.73 trillion naira as of December 31, 2017, compared to 12.12 trillion naira as of June 30, 2015, according to the Debt Management Office.

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