Nigeria’s external debt rose to $145.015 billion in 2025, representing a 6.6 per cent increase from the previous year, according to the World Bank’s International Debt Report 2026.
The latest figures indicate that Nigeria’s external debt has increased significantly over the past decade, rising by $61.8 billion from $83.213 billion recorded in 2015. This represents a 74.3 per cent increase over the 10-year period.
According to the report, public and publicly guaranteed debt accounted for $62.4 billion of Nigeria’s total external debt, while private nonguaranteed debt stood at $54.476 billion. Short-term external debt accounted for the remaining $28.139 billion.
Multilateral Creditors Account for Largest Share
A breakdown of Nigeria’s public and publicly guaranteed external debt showed that multilateral creditors held the largest share at $31.365 billion.
Private creditors accounted for $24.352 billion, while bilateral creditors held $6.683 billion.
Among multilateral creditors, the World Bank’s International Development Association (IDA) accounted for $18.533 billion, making it the largest contributor. International Monetary Fund (IMF) Special Drawing Rights allocations stood at $5.516 billion.
China remained Nigeria’s largest bilateral creditor, with outstanding loans of $5.672 billion.
France followed with $774 million, while other bilateral creditors accounted for $237 million.
Nigeria Records Improvement in Debt-to-Export Ratio
Despite the increase in its external debt stock, Nigeria recorded improvements in two major debt sustainability indicators.
The country’s external debt-to-exports ratio declined by 4.3 per cent to 212 per cent, while its external debt-to-Gross National Income (GNI) ratio fell by 6.6 per cent to 51 per cent.
These reductions suggest an improvement in the country’s debt position relative to its export earnings and national income.
However, the improvement in these indicators was accompanied by a rising debt servicing burden.
External debt service relative to exports increased by 9.6 per cent to 19 per cent, while debt service as a proportion of Gross National Income rose by 6.9 per cent to five per cent.
The figures highlight the continued pressure of external debt repayments on Nigeria’s foreign exchange earnings and broader economic resources.
Global Debt Servicing Payments Reach $1.4 Trillion
The World Bank report also highlighted the growing debt burden facing low- and middle-income countries.
Debt-service payments among these economies reached $1.4 trillion in 2025, marking the fifth consecutive year of increases.
Payments rose by 1.9 per cent during the year, driven largely by obligations to private creditors, particularly international bondholders.
Between 2022 and 2025, countries covered by the report paid approximately $436.1 billion more in debt servicing than they received in new financing.
However, the trend reversed in 2025, when long-term debt flows recorded a net inflow of $45.4 billion, compared with a net outflow of $118.4 billion in 2024.
Private Creditors Charge Higher Interest Rates
The World Bank data also revealed a significant difference between the borrowing costs imposed by official and private creditors in 2025.
New borrowing commitments from official creditors carried an average interest rate of 1.9 per cent, with a maturity period of 25 years and a five-year grace period.
In contrast, private creditors charged an average interest rate of 9.6 per cent, significantly higher than the rates offered by official lenders.
Private borrowing commitments also came with an average maturity period of 12 years and an eight-year grace period.
The difference underscores the higher cost of accessing international private financing compared with loans from multilateral and bilateral official creditors.
For Nigeria, the latest figures present a mixed debt outlook: although some debt sustainability indicators improved in 2025, the rising external debt stock and increasing debt service obligations remain important concerns for the country’s fiscal and economic outlook.