Nigeria's public debt has come under fresh scrutiny as global government borrowing reaches $111 trillion in 2025, according to recent data. Analysts note that while Nigeria's debt stock is not unusually high by international standards, concerns are mounting over the country's ability to service its obligations. Debt servicing costs have risen sharply, consuming a growing share of federal revenue. This trend has sparked debate over fiscal sustainability amid weak economic growth and fluctuating oil prices, key sources of government income.
The Debt Management Office reported Nigeria's total debt stock at ₦119.4 trillion as of December 2024, with external debt accounting for about 35 percent. Domestic debt, meanwhile, has climbed due to increased Treasury bill issuance to cover budget deficits. Servicing this debt consumed over 96 percent of federal government revenue in 2024, raising alarms among economists. "The issue is not just how much is owed, but how the country is paying for it," said economist Adeola Adenikinju. He warned that heavy reliance on short-term domestic borrowing could drive up interest rates and crowd out critical spending.
Nigeria spent more than 96 percent of its federal revenue servicing debt in 2024, a figure that underscores the shrinking space for public investment. With the Debt Management Office overseeing a ₦119.4 trillion liability, the real risk lies in rolling over short-term domestic debt at high interest rates. This limits funds available for infrastructure, health, and education without immediate borrowing shifts. For Nigerians, it means years of constrained government spending even as taxes rise.
