Despite poverty prevalence, Kano, Kaduna, 3 others spend over N122.1 billion on debt servicing in 9 months

By Aminu Abubakar

A review of the budget performance documents across select Northwestern and North Central Nigeria states by SolaceBase has shown that despite poverty and hunger ravaging states, the sum of over N122.1 billion was spent on debt servicing between January and September of the year.

Data review shows that between January and June 2024, representing half a year, Kano State spent N60 billion on public debt servicing, Katsina State spent N12.7 billion between January and September, Niger State spent N29.2 billion within the same period, Kogi expended N18.1 billion, while Jigawa’s expenditure stood at N2.1 billion.

This development on the high expenditure on debt servicing is despite the level of poverty and hunger ravaging these states.

This is also aside from unemployment that has bedevilled the state’s economy.

For instance, the multi-dimensional poverty index of 2022 pegs the unemployment rate in Kaduna state at 44.3%, in Kogi the figure stands at 39%, that of Niger state was put at 38.8%, Jigawa stood at 38.7% and Kano 25.4%.

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In Kano 10.51 million persons are said to be poor, 8.04 million persons are said to be poor in Kaduna, the figure stands at 6.92 million in Katsina, Sokoto has 5.81 million poor persons and Jigawa state recorded 5.76 million poor persons.

Per data from the National Bureau of Statistics, most poor persons can be found in the Northwestern region of the country.

The expenditure on debt servicing is also despite lack of access to basic facilities across the states.

For instance, data by the NBS shows that in Kano State 51% of households in the state lack access to sanitary facilities, 73% of households in Kaduna State lack access to sanitary facilities, 87% of households in Kogi State lack access to sanitary facilities, another 71% in Nasarawa state lack access while the figure stands at 73% in Jigawa state.

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Access to clean water is another issue facing states. For instance, 64% of households in Kaduna state lack access to clean drinking water, in Kano state 31% lack access to clean drinking water, 61% of households in Kogi state lack access to clean drinking water, 50% of households in Niger state lack access to clean drinking water.

What are states spending on debt servicing compared to critical needs?

While Katsina state spent N12.7 billion on debt servicing, it spent N3.9 billion on capital needs of the Ministry of Agriculture and Livestock Development, it spent N3.4 billion on its department for power and energy between January and September 2024.

The capital expenditure for the state Ministry of Water Resources stood at N2.1 billion, all of which is less than what it spent on debt servicing.

While the Kano state government spent N60 billion on debt servicing between January and June,2024, it spent only N18.6 billion on its ministry of works and housing capital needs, based on its budget performance documents.

The capital expenditure for its Ministry of Water Resources stood at N4.2 billion, these monies are lesser than the state’s expenditure on debt servicing.

While Niger State spent N29.2 billion on debt servicing, it spent only N196.5 million on the capital expenditure needs of its Ministry of Basic and Secondary Education, and only N5.3 billion was spent on the capital expenditure of its Ministry of Tertiary Education per details on the state’s budget performance document.

Huge Loan Portfolio Dampens Hope of Lesser Debt Servicing Figure

Data provided by the Debt Management Office (DMO) shows a grim image of the debt portfolio of Nigerian states which includes states cited in this report.

The domestic debt profile of Kaduna state stood at N28.5 billion, that of Kano state stood at N63 billion, Katsina N33.7 billion and Kogi N44 billion, all as of June 2024.

Kaduna state external debt stock stood at $640 million, that of Kano stood at $123 million, Katsina $112 million, and $59 million.

There have been calls on overreliance on loans by state governments, a development that worsen their developmental index.