Nigeria’s total public debt has surged to ₦149.39 trillion ($97 billion) as of March 31, 2025, marking a significant 22.8% increase from the ₦121.67 trillion recorded in the same period last year, according to new data released by the Debt Management Office (DMO).
The rise reflects a ₦27.72 trillion annual increase, with a quarter-on-quarter growth of ₦4.72 trillion from December 2024.
This spike is largely driven by a combination of persistent borrowing and the depreciation of the naira, which has sharply inflated the local currency valuation of external obligations.
External debt now stands at ₦70.63 trillion—up ₦14.61 trillion or 26.1% from Q1 2024.
While dollar-denominated debt rose by only $3.86 billion year-on-year, the naira value soared due to ongoing foreign exchange volatility.
Although the Central Bank of Nigeria used an exchange rate of ₦1,330.26/$1 in Q1 2024, no official rate has been released for Q1 2025, though the figures suggest a further weakening of the naira.
Domestically, Nigeria’s debt reached ₦78.76 trillion ($51.26 billion) by the end of Q1 2025—representing a ₦13.11 trillion or 20% rise from a year earlier.
The federal government holds the bulk of this domestic debt at ₦74.89 trillion, while states and the Federal Capital Territory (FCT) collectively owe ₦3.87 trillion—a slight decline from ₦4.07 trillion in Q1 2024, indicating possible restraint or improved repayment at the subnational level.
Currently, Nigeria’s debt profile is nearly evenly split, with domestic debt accounting for 52.7% and external debt 47.3%, a shift from 2024 when domestic borrowing held a slightly higher share at 54%.
The growing reliance on foreign loans—sourced from multilateral institutions, bilateral partners, and Eurobond markets—has intensified concerns about rising debt service costs, particularly as revenue growth remains sluggish.
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Analysts warn that the increasing burden of external debt, especially when denominated in a weakening local currency, could compromise Nigeria’s fiscal sustainability.
The mounting cost of servicing this debt—both interest and principal—continues to limit fiscal space for critical development spending.
With total debt approaching ₦150 trillion and external repayments swelling under exchange rate pressure, economists and credit analysts are raising red flags about Nigeria’s ability to manage its debt load without undermining future economic stability.
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