A clerk at a currency exchange bureau counts Nigerian naira banknotes in Maiduguri, Nigeria, on Wednesday, May 1, 2019. External actors, such as NGOs, are providing an economic boost to Maiduguri as a tourism economy grows and livelihoods become dependent on them. (Photo: EPA-EFE / STR) 
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The debt strategy is for the period 2020 through 2023 and reflects current economic realities, projected trends, and the impact of the Covid-19 pandemic, according to the statement.
The economy of Africa’s largest oil producer probably contracted last year for the first time since 2016 as the price of crude plunged and added to dollar shortages. The government needs the increase in the borrowing limit to fast-track growth, Samuel Sule, director of the financing group at Renaissance Capital, said by phone.
The DMO will target a 10-year average tenor of obligations in its portfolio, raised mainly from the domestic markets, with long-term securities making up at least 70% of the stock. The new strategy will ensure that government debt is sustainable, the DMO said.
Debt Burden
The West African nation’s public debt is projected to increase to 34% of GDP in 2020 from 29% in 2019 and will rise to about 36.4% in the medium term, according to the International Monetary Fund’s latest report on the country.
Interest payments as a proportion of revenues for the national government, estimated at 92.6% in 2020, is projected to decline to 60.8% this year before rising to 94.1% of revenue by 2025, according to the IMF.
The government will have to work on limiting its debt-service costs because the implications of a further rise are apparent to all, Sule said. Revenue -- oil and non-oil -- need to grow further and the strategy of debt optimization also has to be continued, he said.