Nigeria's External Debt Nears $1 Billion by 2025

As of December 31, 2024, the combined external debt stock of Nigeria's 36 states and the Federal Capital Territory (FCT) is expected to rise to $4.80 billion, increasing to $5.68 billion by December 31, 2025. This represents a net increase of $884.66 million or 18.43% year-on-year.

Data from the Debt Management Office indicates that 33 out of 37 subnational entities recorded an increase in external debt during the review period, accounting for 89.19% of the total. Four states experienced a decline, totaling $59.46 million.

The overall increase in external debt is attributed to continued reliance on foreign financing amid fiscal pressures and rising infrastructure demands, despite improved revenue from the Federation Account Allocation Committee (FAAC) due to rising oil prices and the removal of petrol subsidies. Notably, Katsina recorded the largest absolute increase in external debt, rising by $100.16 million, while Edo, Rivers, Anambra, and Bayelsa posted reductions in their external debt.