The World Bank has revealed how Nigeria, alongside other developing countries spent $443.5 billion to service public debt amid surge in interest rate in 2022.
The multilateral lender revealed this this in its recent International Debt Report for 2023, a longstanding annual publication featuring external debt statistics and analysis for the 122 low and middle-income countries that report to the World Bank Debt Reporting System.
“Amid the biggest surge in global interest rates in four decades, developing countries spent a record $443.5bn to service their external public and publicly guaranteed debt in 2022,” the World Bank said.
The Washington-based global lender stated that the rise in borrowing costs had diverted scarce resources away from critical needs such as education, health, and the environment.
“Debt-service payments which include principal and interest increased by five per cent over the previous year for all developing countries.
The 75 countries eligible to borrow from the World Bank’s International Development Association which supports the poorest countries paid a record $88.9bn in debt-servicing costs in 2022,” World Bank said.
World Bank stated that over the past decade, interest payments by these countries have quadrupled, to an all-time high of $23.6 billion in 2022.
“Overall debt-servicing costs for the 24 poorest countries are expected to balloon in 2023 and 2024 by as much as 39 percent,” it said.
The Bretton Woods Institution stated that rising interest rates had made all developing nations more vulnerable to debt
