Nigeria’s public debt burden increased by ₦57.3 trillion in just 18 months under President Bola Tinubu’s administration, marking a 65.6% jump from ₦87.38 trillion in June 2023 to ₦144.67 trillion by December 2024, according to data from the Debt Management Office (DMO).
This dramatic surge stems largely from a combination of expanded domestic borrowing and the sharp depreciation of the naira, which nearly doubled the naira value of the country’s external debt without a commensurate rise in actual dollar borrowings.
Breakdown of the Debt Spike:
- External debt grew from ₦33.25tn in June 2023 to ₦70.29tn in December 2024.
- Domestic debt rose from ₦54.13tn to ₦74.38tn during the same period.
- In dollar terms, however, total public debt actually fell from $113.42bn to $94.23bn, mainly due to the naira’s plunge from ₦770.38/$1 to ₦1,535/$1.
Federal Government’s Debt Load:
The Federal Government (FG) shoulders more than 90% of the nation’s total debt. Its combined domestic and external debt rose from ₦78.21tn to ₦133.33tn within the 18-month period.
FG’s domestic debt specifically surged by ₦22.1tn, rising from ₦48.31tn in June 2023 to ₦70.41tn by December 2024 — a 45.7% increase. This spike includes the controversial ₦22.7tn in Ways and Means borrowings converted into tradable bonds, approved shortly after Tinubu took office.
Debt Instruments:
- FGN Bonds dominated the portfolio at ₦55.44tn (78.7% of FG’s domestic debt).
- Treasury Bills almost tripled from ₦4.72tn to ₦12.35tn, signaling short-term funding needs.
- Sukuk Bonds, Promissory Notes, and Green Bonds all saw increases, with Promissory Notes doubling to ₦1.54tn, including over ₦1tn in foreign-denominated obligations.
Rising Foreign Debt in Naira Terms:
While dollar-denominated external debt rose modestly from $43.16bn to $45.78bn, its naira value exploded due to exchange rate devaluation. FG’s external debt in naira jumped from ₦29.9tn to ₦62.92tn.
Multilateral institutions like the World Bank’s International Development Association (IDA) were key lenders, with IDA loans increasing from $14.03bn to $16.56bn.
Subnational Debt Trends:
- States’ external debt doubled from ₦3.35tn to ₦7.37tn.
- Domestic debt of states and FCT fell from ₦5.82tn to ₦3.97tn, likely due to tighter borrowing conditions and higher interest rates.
Broader Economic Context:
The debt explosion comes against the backdrop of deep fiscal reforms, heavy inflation, and mounting economic hardship. With naira devaluation increasing the cost of foreign debt and inflation driving up domestic borrowing rates, the government has leaned heavily on short-term instruments like Treasury Bills.
Agriculture and World Bank Support:
The World Bank, in a separate but related development, announced a new financing facility targeting Nigeria’s agriculture sector. It aims to improve irrigation, post-harvest systems, and rural livelihoods, while addressing severe food insecurity affecting over 31 million Nigerians in 2024.
This initiative aligns with the National Agricultural Technology and Innovation Policy (2022–2027) and complements other concessional loans approved to bolster education, nutrition, and economic resilience.
