From Adanna Nnamani, Abuja
Nigeria’s total public debt has surged to N149.39 trillion as of March 31, 2025, representing an increase of N27.72 trillion or 22.8 per cent when compared to the N121.67 trillion recorded in the same period of 2024.
The latest figures released by the Debt Management Office (DMO) also showed a quarter-on-quarter rise of N4.72 trillion or 3.3 per cent from the N144.67 trillion reported at the end of December 2024.
The steady increase in the nation’s debt profile has been attributed to fresh borrowings and the weakening of the naira, which has significantly raised the naira value of external debt obligations.
According to the report, Nigeria’s external debt stood at N70.63 trillion ($45.98 billion) as of March 31, 2025, up from N56.02 trillion ($42.12 billion) in the same period in 2024. This represents a year-on-year increase of N14.61 trillion or 26.1 per cent. On a quarter-on-quarter basis, external debt rose modestly by N344 billion or 0.5 per cent from N70.29 trillion recorded in December 2024. Although the dollar value of external debt rose by $3.86 billion year-on-year, the much steeper rise in naira terms underscores the impact of currency depreciation on the country’s foreign debt burden.
The Central Bank of Nigeria (CBN) used an exchange rate of N1,330.26 per dollar for Q1 2024. While the official rate used for Q1 2025 was not disclosed, the sharp increase in the naira value of external debt suggests a significant weakening of the local currency, thereby increasing the cost of repaying dollar and euro-denominated loans. Nigeria’s external debt portfolio comprises borrowings from multilateral institutions such as the World Bank and the African Development Bank, bilateral lenders, and commercial creditors including Eurobond holders.
On the domestic front, the country’s debt also continued to rise, hitting N78.76 trillion ($51.26 billion) at the end of March 2025, compared to N65.65 trillion ($49.35 billion) in the corresponding period of 2024. This reflects a year-on-year increase of N13.11 trillion or 20 per cent. On a quarterly basis, domestic debt increased by N4.38 trillion or 5.9 per cent from the N74.38 trillion recorded in December 2024.
Out of the N78.76 trillion domestic debt, the Federal Government accounted for N74.89 trillion, while the 36 states and the Federal Capital Territory (FCT) held N3.87 trillion. Notably, domestic debt at the state level declined slightly from N3.97 trillion in Q4 2024 and from N4.07 trillion in Q1 2024. This decline may indicate a more cautious borrowing approach by subnational governments or improved debt servicing within the period.
Domestic borrowings are typically raised through government instruments such as Treasury Bills, FGN Bonds, Sukuk, and Green Bonds. While these instruments shield the country from exchange rate volatility, they still carry significant interest costs.
The data also revealed that as of March 2025, domestic debt accounted for 52.7 per cent of the total debt stock, while external debt made up the remaining 47.3 per cent. This reflects a shift from the structure recorded in March 2024, where domestic debt held a 54 per cent share and external debt accounted for 46 per cent. The rising share of external debt in naira terms highlights the mounting currency risks Nigeria faces as it continues to depend on foreign loans to bridge fiscal gaps. At the same time, the growth in domestic debt signals the government’s sustained efforts to source funds locally despite rising debt service obligations and concerns over private sector crowding out.
With the debt stock inching close to the N150 trillion mark concerns are mounting over the country’s fiscal sustainability, particularly as debt servicing now consumes a large chunk of the national budget.