New year, same wahala
Nigeria’s debt is rising higher than Burj Khalifa
Good morning, Big Brains. If you’re new here, congratulations, you’re one of the cool kids now. You’ll love it here! I hope your first day back in the office was productive. And if it wasn’t, we go again today.
- Margaret
Word count: ~ 1, 000
Reading time ~ 4 mins
Let’s get into today’s edition:
Nigeria is in serious debt, and the repayment interest is killing us
CBN’s terminated staff members are dragging it to court
The Big Deal
Nigeria is in serious debt, and the repayment interest is killing us
It’s not exactly breaking news that Nigeria is in debt, but the interesting numbers we saw in the CBN’s recent International Payment Data are enough to scream “God abeg” from a mountaintop or, more realistically, rant on Elon Musk’s app.
According to the CBN data, Nigeria spent $3.53 billion on external debt servicing in just the first nine months of 2024. That’s a 38% jump from 2023. What this means is that Nigeria borrowed its way into a ridiculously expensive debt interest.
Let’s break it down: In January 2024 alone, we spent $560.52 million—almost five times the $112.35 million we paid in January 2023. May was even more dramatic, with $854.37 million paid out, a 287% increase from May 2023. Even though some months were better than others, the overall trend is clear—Nigeria is using all its money to pay back loans (and we’re still not close to repaying all our debt).
If you haven’t clocked the generous use of “our” so far, clock it now because we’re all in this together. There were rumours that we might all inherit some of Nigeria’s gbese at some point. Even though the rumours are not true (yet), whoever started it was on to something.
Why is this a big deal?
Experts are already waving the red flag because Nigeria’s debt profile isn’t just high—it’s a one-way ticket to an unsustainable future. As a country, we’ve still not figured out how to make more money from non-oil sectors. With the level of our debt and how much it's raking in, the finance bros are saying that we’re heading for a financial disaster faster than you can say debt servicing.
Think of it this way: every dollar we use to service debt is one less dollar for schools, hospitals, roads, or even fixing our embarrassing power supply. The more we borrow, the deeper we sink into the hole we’re digging.
You’d think the federal government would be going easy on external loans in 2025, but Sike! The morale is even higher; We’re starting 2025 strong with another proposed loan, which is supposed to cover some parts of the ₦47.9 trillion 2025 budget.
The cycle of borrowing seems to be unending, and the real losers are everyday Nigerians. This debt trap means more inflation, higher taxes, and frustration for already frustrated citizens.
Without solid strategies to grow revenue from other sectors, we certainly won’t be leaving the trenches anytime soon.
CBN’s terminated staff members are dragging it to court
While the rest of the world is repeating the “New year, new me” mantra, the CBN and its former employees are shouting, “New year, new drama” at the top of their lungs.
In 2024, the Central Bank of Nigeria (CBN) laid off some of its employees. Now, these ex-employees are dragging the apex bank through the mud all the way to the courtroom, accusing it of disregarding labour laws, breaching their contracts, and treating them like disposable assets.
The drama started in March 2024 when CBN fired over 200 employees, claiming it was part of a "reorganisation." But the affected staff say they were caught off-guard by the move, given only three days to leave their jobs. As if that wasn’t bad enough, the payments these guys received were next to nothing. Some ex-employees with 10 to 20 years of service claimed that they received as little as ₦5,000 after tax deductions
The legal battle, led by 33 laid-off workers represented by Stephen Gana, is based on claims that their dismissals were unconstitutional and violated CBN’s Human Resources Policies and Procedures Manual. The termination letters, which had the title “Reorganisational and Human Capital Restructuring,” might have sounded cute, but the affected employees say that was CBN’s way of hiding the unfair process.
Now, they are asking the court to declare their employment termination null and void, give them back their jobs, and pay withheld salaries. Oh, they’re also asking for a casual sum of ₦30 billion in damages for their suffering, plus ₦500 million to cover legal expenses.
In its defence, the CBN claims it followed due process, including paying three months’ salary after the notice. The bank is standing on the claim that the terminations were part of an internal restructuring but some media houses have reported that CBN aired their request for specific details about the layoff.
You know the drama is unnecessary when the court advises both parties to explore an amicable resolution, but CBN isn’t backing off, and neither are the laid-off staff members. The next hearing is scheduled for January 29, 2025. For the CBN, this case could either serve as a reminder of the importance of fair labour practices or become another stain on its already shaky reputation.
Again, there are no spoilers, so we’ll all have to watch the drama unfold.
This Week’s Big Question
“What’s your biggest goal in 2025?”
Ayomipo’s response - “Last year, I set goals, and I barely achieved any. I’m not sure if it’s disappointment or fear,but I don’t have new goals yet.”
You can also share your response here, and if it’s as interesting as Ayomipo’s, we’ll feature it in the next edition.
The Big Picks
My New Year Message Has Attracted Threats To My Life, Obi Alleges: Peter Obi, the Labour Party's presidential candidate in the 2023 elections, has claimed his life is being threatened after he criticized President Bola Tinubu's administration in his New Year message.
Trudeau Resigns As Canada PM: Canada’s Prime Minister, Justin Trudeau, announced on Monday that he is stepping down. He stated he will remain in office until the ruling Liberal Party selects a new leader, following months of declining approval ratings and internal party conflicts.