IMF warns nations against rising debt burden

By Abubkar Yunusa

The Managing Director of the International Monetary Fund, Kristalina Georgieva, has cautioned countries against rising debt levels, saying excessive borrowing stifles economic growth and resilience.
Georgieva issued the warning on Monday during a civil society town hall at the ongoing annual meetings of the World Bank and IMF.
She noted that many economies, including advanced and emerging ones, are experiencing increasing debt burdens that could weaken their long-term growth prospects.
“The consequences are that we have to be much more focused on bringing debt levels down, because very high levels of debt suffocate economies,” Georgieva said.
Her warning comes as Nigeria’s Debt Management Office recently disclosed that the nation’s total public debt rose to N152.39 trillion as of June 30. Of this, N80.55 trillion is domestic debt, while N71.84 trillion represents external obligations.
Despite debt levels in some low-income countries appearing to decline, Georgieva explained that this trend was not due to sound fiscal management but a lack of access to financing.
“Even if their debt is going down, it remains incredibly difficult for low-income countries to cope with these levels of debt,” she said.
The IMF chief reaffirmed that the fund would prioritise policies and support mechanisms designed to help countries reduce their debt burdens and strengthen economic resilience.
Nigeria remains classified as a lower-middle-income economy by the World Bank.
“Such a claim is entirely devoid of truth and should be recognised as an intentional effort to mislead the public. It must be stressed that NNPCL operates as an independent entity under the Companies and Allied Matters Act, with a fully empowered Board of Directors.”
Lokpobiri said the ministry does not, and will not, interfere in the internal decisions of NNPC, including pricing matters.
The minister said the reports suggesting different perspective are incorrect and also reveal a profound misunderstanding of the deregulated nature of Nigeria’s petroleum sector.
On August 26, Lokpobiri had said petrol smuggling persists in Nigeria because the NNPC sell below the landing cost.
Prior to this, Umar Ajiya, the chief financial officer (CFO) of the NNPC, on August 20, said the company was selling petrol at only half the land cost.
Before the latest adjustment, the official pump price of petrol was about N600/litre but the landing cost is around N1,200.