Nigeria’s mounting debt profile has come under renewed scrutiny, as fresh data show the country has risen to become the third-largest borrower from the International Development Association (IDA), even as its total public debt surged to ₦153.29 trillion.
Figures contained in the IDA Management’s Discussion and Analysis for the period ended December 31, 2025, reveal that Nigeria’s exposure to the World Bank’s concessional lending arm rose to $18.7 billion — a $1.9 billion increase from $16.8 billion recorded at the end of 2024. The 11.3% year-on-year rise places Nigeria behind only Bangladesh ($23.0bn) and Pakistan ($19.4bn) among countries with the highest IDA loan exposure.
The latest figure represents an increase of ₦900 billion, or 0.59%, when compared with the ₦152.39 trillion recorded at the end of June 2025, reflecting a continued upward trajectory in the nation’s debt profile.
The total public debt comprises domestic and external borrowings by the federal government, the 36 states, and the Federal Capital Territory (FCT). Domestic debt: ₦81.81 trillion ($55.47 billion); External debt: ₦71.47 trillion ($48.46 billion).
The development underscores Nigeria’s growing reliance on multilateral financing at a time of widening fiscal pressures and persistent revenue challenges.
A breakdown of the domestic component shows that the federal government continues to account for the bulk of the liabilities. Federal domestic debt rose to ₦77.81 trillion in the third quarter of 2025, up from ₦76.58 trillion in the second quarter. At the sub-national level, domestic debt owed by states and the FCT edged up slightly from ₦3.96 trillion in June to ₦4 trillion in September.
The steady rise in debt comes amid persistent fiscal pressures and widening budget deficits. Nigeria’s projected deficit for the 2026 fiscal year is estimated at ₦23.85 trillion — equivalent to 4.28% of Gross Domestic Product (GDP) — highlighting the scale of financing needs confronting the government.
Analysts attribute the increase to continued borrowing to fund infrastructure projects, support development initiatives, and plug revenue shortfalls. However, critics argue that the pace of borrowing reflects deeper structural weaknesses in revenue generation, particularly in non-oil sectors.
Nigeria’s rising exposure to the IDA, coupled with its expanding domestic and external debt obligations, places fiscal management firmly in the spotlight. As deficits widen and debt servicing continues to consume a substantial share of revenues, calls for deeper reforms — including improved non-oil revenue mobilisation, stricter fiscal discipline, and enhanced transparency — are likely to grow louder.
