Nigeria's total public debt rose to 38 trillion naira ($92.75 billion) as of September, up 18% from a year earlier, the Debt Management Office (DMO) said on Tuesday.

Africa's largest economy has been racking up debt to fund infrastructure projects and boost a fragile economy now recovering from recession following the impact of an oil price crash triggered by the coronavirus pandemic.

Total public debt stood at 32.22 trillion naira in the third quarter of 2020.

A $4 billion eurobond sale in September - to enable the government fund its budget, support the currency and boost forex reserves - accounted for a 7% rise in debt from the second quarter, the DMO said in a statement.

Nigeria is considering issuing more eurobonds, but debt service is a concern.

Fitch has said Nigeria needs a credible path to stronger non-oil revenue mobilisation to improve its debt ratios and its external position for a positive rating.

President Muhammadu Buhari has made upgrading transport networks and investing to improve outdated power grids the pillar of his administration, with a view to boosting agriculture and other non-oil industries to cut dependence on dwindling crude revenues. Funding, however, has been a major constraint.

In November, the Senate approved external dollar-denominated borrowing from China and other foreign lenders of $16.23 billion to fund projects in different sectors of the economy.

($1 = 409.72 naira)

Reuters