Nigeria spent about ₦27.2 trillion servicing public debt between 2024 and 2025, exceeding capital expenditure by roughly ₦3.9 trillion during the same period, according to a media brief from the Federal Ministry of Finance.
The document showed that debt servicing rose from ₦12.63 trillion in 2024—well above the ₦8.56 trillion budgeted—to ₦14.57 trillion in 2025, surpassing the ₦13.12 trillion provision in the budget. Overall, actual debt payments exceeded projections by about ₦5.52 trillion across the two years.
The ministry attributed the increase largely to macroeconomic factors such as the depreciation of the naira and higher domestic interest rates, which raised the local currency cost of servicing external debt. Debt servicing also consumed a large portion of government revenue. In 2024, it accounted for about 60 percent of federal revenue, while by November 2025 the ratio had risen to roughly 66 percent.
Although capital spending remained significant—₦11.59 trillion in 2024 and ₦11.7 trillion by November 2025—debt servicing still outpaced infrastructure investment in both years.
The ministry said fiscal reforms introduced since 2023, including the securitisation of about ₦30 trillion in Ways and Means advances from the Central Bank of Nigeria, were aimed at improving transparency and strengthening long-term fiscal sustainability.
However, experts warn the rising debt service burden could limit funding for infrastructure and social services. Analysts also project the country’s debt servicing could reach about ₦15 trillion in the 2026 budget, potentially constraining economic growth.
