Nigeria's external debt has gradually grown to nearly half of the country's total public debt as of H1 2024

Key takeaways:

  • External debt has nearly doubled as in 2017, it stood at 26.64%, but by 2024, it had risen to 46.96%.
  • Domestic debt has dropped from 73.36% in 2017 to 53.04% in 2024, showing a decline.
  • Nigeria’s increasing reliance on external loans suggests a strategic shift in public debt financing.
  • Unlike other years, domestic debt share slightly increased in 2023, rising to 60.74%, before external debt rebounded in 2024.
  • A rising share of external debt means higher exposure to foreign exchange risks and global market conditions.
  • If the trend continues, Nigeria’s external and domestic debt may soon be equal, reducing the traditional dominance of domestic borrowing.

The share of external debt in the country’s total public debt has increased from 26.64% in 2017 to 46.96% in the first half of 2024. This represents a clear trend of rising external borrowing, reducing the dominance of domestic debt in the overall debt structure. External debt has nearly doubled its share within this period, while domestic debt has seen a corresponding decline.
In 2017, domestic debt accounted for over 73% of total public debt, but by 2024, it had dropped to just 53%. This shift highlights a growing reliance on foreign borrowing, which could have implications for debt servicing costs, exchange rate fluctuations, and overall economic stability.

Source:

Debt Management Office (DMO)

Period:

2017 - 2024
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Nigeria set to clear IMF debt by mid-2025 after reducing outstanding balance by 87.5% from March 2023 to March 2025
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  • The debt burden is rising faster than economic growth as interest payments as a percentage of GDP grew from 5.4% in 2008 to 8.2% in 2024, showing increasing financial strain.
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