The Federal Government of Nigeria has reportedly borrowed an additional N3.8 trillion from the Central Bank of Nigeria in what seems to be fresh Ways and Means Borrowing within the last six months of 2023.

This revelation comes from provisional data published in the latest Statistics bulletin for the fourth quarter of 2023 recently released by the central bank obtained by Nairametrics.

According to the data, the total figure increased from N4.4 trillion at the end of June 2023, indicating a cumulative balance of N8.2 trillion in Ways and Means balances due by the government as of December 2023.

Despite previous assertions suggesting that the government had not borrowed money from the CBN, the recent data contradicts this narrative.

“The Ways and Means provision serves as a mechanism enabling the government to secure short-term or emergency financing from the CBN to address cash flow gaps,” the report explains.

Analysis of the data reveals a steady rise in balances, starting from N4.36 trillion at the end of June 2023 and increasing every month thereafter. By December, the total reached N8.21 trillion, marking an 88% increase in 6 months.

Last year, the National Assembly approved the securitization of N22.7 trillion from the N23.3 trillion previously advanced by the CBN to the Federal Government through Ways and Means. This debt was subsequently transferred to the Debt Management Office (DMO) with a 40-year tenor, a 3-year moratorium, and an interest rate of 9%.

According to Section 38 of the CBN Act, 2007, the apex bank may grant temporary advances to the Federal Government in the face of a temporary deficiency of budget revenue. The Act places a limit of five percent on how much the Federal Government could borrow, although recent amendments have increased this limit to 15% of the previous year’s revenue.

The Senate of the 10th assembly has also approved the securitization of the outstanding N7.3 trillion in Ways and Means, indicating further action to address the escalating debt figures.