Governor of Central Bank of Nigeria Calls for Prioritizing Balanced and Resilient Debt Portfolio

The Governor of the Central Bank of Nigeria, Mr Olayemi Cardoso, has emphasized the importance of countries prioritizing building a balanced and resilient debt portfolio. Speaking at a regional training on annual borrowing plan development in Abuja, Cardoso highlighted the Nigerian government’s Debt Management Strategy (DMS) as a key tool in securing necessary financing at the lowest cost.

The DMS aims to prudently manage risks and develop the domestic debt market, demonstrating the government’s commitment to fiscal strategy and transparency in debt management practices. Cardoso explained that the DMS is implemented annually through an Annual Borrowing Plan, which offers benefits such as enhancing predictability, fostering investor confidence, and attracting a broader pool of investors with more favorable borrowing terms.

Collaboration among stakeholders, including the Ministry of Finance, the Central Bank, and debt management agencies, is crucial in developing the Annual Borrowing Plan. This collaborative process strengthens decision-making, aligns borrowing activities with macroeconomic objectives, and promotes responsible debt management practices to reduce the likelihood of debt distress and its adverse economic consequences.

Cardoso emphasized that formulating robust Debt Management Strategies and Annual Borrowing Plans requires a comprehensive approach involving a well-coordinated institutional framework for public debt management and a stable macroeconomic environment. By prioritizing these strategies, countries can build a balanced and resilient debt portfolio to navigate economic challenges effectively.