President Muhammadu Buhari, who is leaving office, stated in a public letter asking for parliament’s consent that Nigeria has issued debt instruments worth $1.18 billion to settle various judgment debts.
President-elect Bola Tinubu will take office on Monday, and Buhari said his cabinet had approved on March 29 the use of promissory notes to settle court judgments and other general debts owing by the government.
In most cases, courts award judgment debt to creditors or debt collectors who are attempting to resolve debt disputes.
Federal ministries, departments, and agencies were responsible for the judgment obligations totaling $566.75 million, 98.52 million pounds sterling ($124.35 million), and 226.28 billion naira ($491.92 million), Buhari added without providing more information.
During the tenure of the preceding administration, Nigeria used borrowing to pay its budget. According to Buhari, the government would issue promissory notes to the creditors, which it will eventually settle through expenditures from the annual budget.
Promissory notes “will then be redeemed over time through provisions in the budgets of the Federal Government of Nigeria,” Buhari said in a letter to Senate President Ahmad Lawan requesting approval. On Wednesday, the Senate read the letter.
It is anticipated that the Senate will pass the proposal.
Nigeria’s overall public debt increased from 39.56 trillion to 46.25 trillion naira ($103.1 billion) in 2022 as a result of increased borrowing by the government to cover its budget deficit in the face of strong global inflation.
