Public Debt Increases by N57trn in 18 Months
Nigeria’s total public debt rose by N57.3tn within the first 18 months of the current administration, according to an analysis of data released by the Debt Management Office.
The increase represents a 65.6 per cent surge in the debt stock, growing from N87.38tn recorded at the end of June 2023 to N144.67tn as of December 2024.
President Bola Tinubu, who assumed office on May 29, 2023, inherited a debt portfolio that already reflected heavy domestic obligations, including a N22.7tn Ways and Means balance from the Central Bank of Nigeria. However, within a year and a half, Nigeria’s borrowing profile expanded sharply, driven by increased local debts and a steep depreciation of the naira.
At the end of June 2023, the DMO reported that Nigeria’s total external debt stood at N33.25tn, while domestic debt was N54.13tn. By December 2024, external debt had jumped to N70.29tn, while domestic debt climbed to N74.38tn.
The rise in external obligations, both in absolute and proportional terms, marks a shift in the composition of Nigeria’s debt, with foreign debt now accounting for nearly half of the country’s total debt stock.
In dollar terms, however, the debt picture looks different. The total public debt declined from $113.42bn in June 2023 to $94.23bn by December 2024, reflecting a nominal decrease of 17 per cent.
But this reduction is not due to lower borrowings. It stems from the sharp depreciation of the naira, which fell from an official exchange rate of N770.38 to $1 in June 2023 to about N1,535 to $1 by the end of 2024.
The exchange rate movement significantly impacted the naira valuation of Nigeria’s dollar-denominated debts. Although the dollar amount of foreign borrowings remained relatively stable, the naira value nearly doubled.
The Federal Government’s external debt, for instance, rose from N29.9tn in June 2023 to N62.92tn by December 2024, while that of the states and the Federal Capital Territory increased from N3.35tn to N7.37tn over the same period.
There was also a notable reduction in the domestic debt of sub-national governments. States and the FCT owed N5.82tn in domestic debt as of June 2023, which fell to N3.97tn by December 2024. This drop may reflect a decline in their access to more debt as borrowing costs surge.
At the federal level, the total debt obligation — combining domestic and foreign borrowings — climbed from N78.21tn to N133.33tn, indicating that the Federal Government remains responsible for over 90 per cent of the country’s total debt.
The growing weight of external debt has also altered the structural balance of Nigeria’s debt portfolio. In June 2023, external debt accounted for 38 per cent of the total. By December 2024, that figure had risen to nearly 49 per cent.
