According to the most recent data from the Debt Management Office, Nigeria’s debt to China is currently $4.1 billion as of September 2021. This balance is part of a total debt of $6.5 billion that Nigeria can draw on.
The majority of the debts are for a period of 20 years, with a 7-year grace period to repay the principal. A $200 million debt had a tenor of 12 years and a grace period of 5 years. The loans are divided into dollar-based and Yuan-based loans totaling $4 billion and another CNY480 billion.
Nigeria’s debt to China has risen over the last decade as the government diversifies its debt portfolio toward less expensive but more contentious Chinese loans. The loan interest rates average 2.5 percent per year. The DMO reported in June that the total value of loans taken out by Nigeria from China as of March 31, 2020 was $3.121 billion.
This is only about 3.94 percent of Nigeria’s total public debt as of March 31, 2020, which was $79.303. Similarly, loans from China accounted for 11.28 percent of the total external debt stock of $27.67 as of the same date.
The majority of the loans were made during the Goodluck Jonathan administration, with over $2.7 billion drawn from a total principal available of $3.1 billion. Between April 2016 and December 2019, Nigeria increased its borrowings, resulting in a $1.3 billion balance.
Nigeria has also repaid $565.23 million in principal repayments and $477.98 million in interest, leaving an outstanding $3.5 billion to pay from the funds drawn thus far.
Chinese loans, according to the government, are project-related loans. Nigerian Railway Modernization Project (Idu-Kaduna section), Abuja Light Rail Project, Nigerian Four Airport Terminals Expansion Project (Abuja, Kano, Lagos, and Port Harcourt), Nigerian Railway Modernization Project (Lagos-Ibadan section), and Rehabilitation and Upgrading of Abuja-Keffi- Makurdi Road Project are among the 11 projects as of March 31, 2020.