More than half of the Federal Government of Nigeria’s domestic debt services are services on FGN bonds

Key takeaways:

  • FGN Bonds dominate Nigeria’s domestic debt service payments, rising from 66.6% in 2017 to 87.9% in 2024. This reflects a growing reliance on long-term debt financing.
  • Treasury Bills have seen a sharp decline in their share of domestic debt service, dropping from 30.1% in 2017 to just 6.4% in 2024. This suggests a shift away from short-term debt instruments.
  • Treasury Bonds, which peaked at 14.9% in 2022, also declined to just 5.6% in 2024.
  • By 2021, over 80% of domestic debt service payments were already allocated to FGN Bonds, showing a consistent pattern of prioritisation. The trend has only intensified in subsequent years.
  • The rising dominance of FGN Bonds means Nigeria is locking itself into long-term repayment obligations, potentially increasing the fiscal burden in the future.
  • This trend underscores the need for careful debt management policies to prevent a future where long-term commitments become a burden rather than a stabilising factor. 🚨

Nigeria’s domestic debt service structure has become increasingly dominated by FGN Bonds, which accounted for a staggering 87.9% of total payments in 2024. This is a sharp increase from 66.6% in 2017, reflecting a gradual shift in the government’s debt servicing strategy. The reliance on FGN Bonds has significantly reduced the share of Treasury Bills and Treasury Bonds, which played a more significant role in earlier years.
Between 2017 and 2024, Treasury Bills' share plummeted from 30.1% to just 6.4%, while Treasury Bonds, which peaked at 14.9% in 2022, now make up only 5.6% of the total.

Source:

Debt Management Office (DMO)

Period:

2017 - 2024
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