Nigeria’s foreign debt servicing surges by 107.7% to N3.8 trillion in eight months 

This is contained in the 2025-2027 Medium Term Expenditure Framework and Fiscal Strategy (MTEF & FSP) published by the Budget Office and obtained by Naijaonpoint.

The 2024 budget initially projected foreign debt servicing costs at N1.83 trillion, but actual spending surged to N3.8 trillion within the same period, resulting in an increase of N1.97 trillion, according to the report.

According to the report, the Federal Government of Nigeria (FGN) achieved N12.74 trillion in retained revenue by August 2024, representing 73.8% of its targeted N17.25 trillion for the year. The report shows that the deviation was largely due to the delayed implementation of the anticipated windfall tax, which has yet to materialize.

Despite these gains, the report emphasizes that oil revenues underperformed due to persistent challenges in the sector, including price volatility and production constraints.

According to the report, Nigeria’s gross oil and gas revenue for 2024 was projected at N20 trillion, but as of August, only N9.83 trillion was realized from the prorated sum of N13.33 trillion. This represents a performance rate of 72.1%, falling significantly short of expectations.

The rise in Nigeria’s foreign debt servicing costs highlights growing fiscal challenges with potentially significant consequences for the economy.

This year, Nigeria’s public debt has grown due to various factors, including the depreciation of the naira and increased domestic borrowing, often at higher interest rates.

As earlier reported by Naijaonpoint, the country’s debt-to-GDP ratio exceeded 50% for the first time by the end of March 2024, following the release of revised GDP figures.

The depreciation of the naira has substantially increased the cost of servicing external debts, which are paid in foreign currencies, further straining public finances.