Bauchi Maintains Position as 5th Most Indebted State in Nigeria with $186 million

Bauchi State has maintained its position as the fifth most indebted state in Nigeria, with an external debt stock nearing $186 million, according to recent data.

Despite a marginal 1% decline from $187.63 million in previous records to $185.28 million as of late 2024, the state’s fiscal situation remains a cause for concern.

The debt figures place Bauchi second only to Kaduna among Northern Nigerian states. Kaduna leads the region with a significantly higher external debt of $587 million. Analysts point out that Bauchi’s debt portfolio underscores broader challenges in balancing development needs with financial sustainability.

What has raised additional eyebrows is the state’s participation in a new loan request. Alongside 11 other Northern states including Katsina and Kano Bauchi is seeking a fresh loan package totaling N730.91 billion.

This request comes even as these states collectively owe $1.3 billion in foreign debt and N644.3 billion in domestic obligations.

Debt servicing costs have also surged nationwide. Nigerian states spent approximately N139.92 billion on external debt servicing in the first half of 2024 alone, a dramatic 122% increase compared to the same period in 2023.

The spike is largely attributed to the continued devaluation of the naira, which has made dollar-denominated repayments more expensive.

Public policy experts warn that while borrowing can fuel critical infrastructure projects and social programs, the long-term fiscal implications must be carefully managed.

Without a corresponding increase in internally generated revenue or economic productivity, heavy reliance on loans could put states like Bauchi at risk of a deeper debt trap.

As stakeholders watch the next steps in Bauchi’s financial strategy, questions remain about how the state plans to balance its borrowing with sustainable development and fiscal responsibility.