THE World Bank has listed Nigeria and nine other countries as nations with high-debt risk exposure.
In a financial statement for the International Development Association (IDA) released on Monday, the World Bank pegged Nigeria at number five with a $11.7 billion IDA debt stock.
“As of June 30, 2021, the ten countries with the highest exposures accounted for 66% of IDA’s total exposure.
“IDA’s largest exposure to a single borrowing country, India, was $22 billion as of June 30, 2021. Monitoring these exposures relative to the SBL, requires consideration of the repayment profiles of existing loans, as well as disbursement profiles and projected new loans and guarantees”, it explained in the document.
India tops the list with an IDA debt stock of $22b. Bangladesh, with $18.1b is second and followed by Pakistan ($16.4b), and Vietnam with $14.1b.
The World Bank further explained: “IDA faces two types of credit risk: country credit risk and counterparty credit risk.
“Country credit risk is the risk of loss due to a country not meeting its contractual obligations, and counterparty credit risk is the risk of loss attributable to a counterparty not honoring its contractual obligations. IDA is exposed to commercial as well as noncommercial counterparty credit risk.”
As of September 2020, Nigeria had taken a $31.98 billion worth of loans from the World Bank Group, International Monetary Fund (IMF), African Development Bank (AfDB), according to the Debt Management Office (DMO).
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