26 Nigerian states added a combined $239m to their external debt in H1 2025

  • 26 states increased their external debt by a combined $239 million in H1 2025.
  • Imo, Oyo, Kaduna, Enugu, and Ogun recorded the biggest increases.
  • 11 states, including the FCT, reduced their debt through higher repayments.
  • Lagos, Edo, Rivers, and Bauchi accounted for most of the $227 million in reductions.
  • Total state external debt rose only slightly, from $4.8 billion to $4.812 billion.

In the first half of 2025, state-level external debt in Nigeria shifted in different directions, with some states adding to their balances while others reduced theirs through repayments that outweighed any new borrowing.

Across the 26 states that recorded increases, external debt rose by a combined $239 million, driven mainly by Imo, Oyo, Kaduna, Enugu, and Ogun. In contrast, 11 states including the FCT saw their debt stocks decline, with Lagos, Edo, Rivers, and Bauchi accounting for the largest reductions, together cutting about $227 million.

These opposing movements meant that total external debt across all states rose only marginally, from $4.8 billion in December 2024 to $4.812 billion in June 2025, a net increase of just $12 million.

Source:

Debt Management Office

Period:

June 2025
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Lagos, Rivers, and four other states account for 52% of all Nigerian states' domestic debt and 40% of their external debt
  • Lagos dominates Nigeria’s subnational debt profile, accounting for 26.1% of domestic debt and 21.8% of external debt.
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  • The same group contributes 40% of the external debt
  • Rivers ranks second in domestic debt (9.5%) but has a significantly lower external debt (3.8%).
  • Kaduna emerges as a major external borrower (13.7%) despite not appearing among the top domestic debt states.
10 Nigerian states and the FCT cut their external debt by a combined $227.19 million in H1 2025
  • Ten states and the FCT collectively reduced their external debt by $227.19 million in H1 2025.
  • Lagos, Edo, and Rivers accounted for most of the reductions, making up more than three-quarters of the total.
  • Several smaller states also trimmed their balances, but by relatively modest amounts.
  • These reductions significantly offset the increases recorded by 26 other states, helping keep nationwide net external debt growth low.
Nigeria’s public debt has soared since 2010, with domestic debt up 2,020% and external debt up 1,000% by mid 2025
  • Nigeria’s domestic debt jumped from ₦3.8 trillion in 2010 to ₦80.55 trillion by mid-2025.
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  • Debt accumulation surged notably after 2020, coinciding with pandemic spending, naira depreciation, and higher fiscal deficits.
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Borno records lowest domestic debt in North-East Nigeria at ₦22.3 billion in Q2 2025
  • The six North-Eastern states collectively owe around ₦450 billion in domestic debt as of Q2 2025.
  • Borno State maintains the lowest debt in the region at ₦22.3 billion, showing signs of controlled borrowing amid post-conflict rebuilding.
  • Bauchi State has the highest domestic debt burden of ₦143.6 billion, accounting for about 31% of the region’s total.
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In just six months, Nigeria spent over $2.3 billion servicing external debts
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  • Multilateral lenders like IDA and AfDB collectively received about $463 million, signalling continued exposure to concessional financing.
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