Nigeria’s Debt per capita may hit over two Hundred thousand naira in 2023. An earlier report by Dataphyte had shown that the country plans to generate the sum of N8.64 trillion with an estimated expenditure of N19.76 trillion. This is a fall from the N9.97 trillion estimated as revenue for 2022.
This would mean that the budget deficit of the country is expected to hit N11.12 trillion in 2023 which will push up the country’s debt profile, currently put at N41.60 trillion, to N52.72 trillion.
If the country’s borrowing increases by the estimated figure, that’s a 26.7% increase over current standing and naturally impacts on the per capita debt which is the average debt by person if the debt is calculated by the population of the country.
Based on the current population of the country put at 216.746 million and factoring in the projected population growth target of 2.5% for 2023 as contained in the National Development Plan, Nigeria’s population may reach 222.164 million by 2023 and so the per capita debt for 2023 will then be N237,302
This is a 23.6% increase over the current debt per capita of N191,947.
Between 2015 and 2022, Nigeria’s per capita debt has continued to rise, amounting to 175.71% increase within the period.
There have been concerns about Nigeria’s rising debt profile with calls for the country to diversify its revenue source. However the country’s revenue generation plans for 2023 do not show any real plans for revenue diversification, at least in the coming year.
The fall in revenue projections for 2023 is largely due to fall in oil revenues, revenue from Government Owned Enterprises and a fall in independent revenue. The Federal government plans to generate N2.433 trillion from non-oil taxes and N1.86 trillion from its share of oil revenue which makes oil incomes the 2nd highest source of revenue in 2023. The first is taxes which could be especially problematic in a country with high inflation, high poverty rates and reduction in purchasing power. Aside from the downside of increasing taxes beyond a certain point, there is also the challenge of trust because tax revenue must produce certain outcomes that directly benefit the tax-payers and government’s history with honoring social contracts is not stellar because of corruption and waste.
Only N3.644 billion is targeted to be generated from the Solid Minerals and Mining sector, the target is an increase from the N2.915 billion estimated for 2022 fiscal year. Solid minerals are a viable option for non-oil revenues but Nigeria will not be reaping its full rewards in 2023.
The inability of the country to tap its potentials and really diversify the economy legitimises oncerns on the ability of the country to reduce its debt burden.