Nigeria’s external debt stock increased by 6.6 per cent in 2025, while the World Bank flagged a $5bn financing arrangement backed by $6.7bn in domestic government securities.
Nigeria’s external debt stock rose by 6.6 per cent to $145.02 billion in 2025, from $135.99 billion in 2024, according to the World Bank’s International Debt Report 2026.
The report, published on November 5, 2026, showed that Nigeria’s external debt increased by approximately $9.03 billion during the year, bringing its total obligations to foreign creditors to more than $145 billion.
The World Bank’s country data put long-term public and publicly guaranteed external debt at $56.88 billion, private non-guaranteed debt at $54.48 billion and short-term external debt at $28.14 billion. The figures, alongside IMF credit and Special Drawing Rights allocations, make up the reported external debt stock. International Debt Statistics+1
How Nigeria’s debt is structured
The World Bank’s figures show that private non-guaranteed debt accounted for $54.48 billion, while short-term external obligations stood at $28.14 billion.
Public and publicly guaranteed debt, which includes government borrowing and loans backed by government guarantees, was reported at $62.4 billion when IMF credit and SDR allocations are included. The World Bank’s table separately lists this public debt category at $56.88 billion and IMF credit and SDR allocations at $5.52 billion. International Debt Statistics
The figures show that Nigeria’s external debt exposure extends beyond direct government borrowing to include private-sector obligations and short-term liabilities.
There is also a difference between the World Bank’s broader external debt figures and the Debt Management Office’s public external debt records.
The DMO’s provisional figures put Nigeria’s external public debt at $51.86 billion as of December 31, 2025, comprising $23.85 billion owed to multilateral creditors, $6.72 billion to bilateral creditors and $21.28 billion to commercial creditors and lenders. The two figures have different coverage and should not be treated as competing estimates of the same debt category. dmo.gov.ng+1
Nigeria’s $5bn swap arrangement and $2.35bn Eurobond
The World Bank also highlighted Nigeria’s $5 billion total return swap (TRS) financing arrangement in 2026, backed by approximately $6.7 billion in domestic government securities.
The collateralisation ratio of about 133 per cent means Nigeria pledged securities worth roughly 33 per cent more than the financing obtained.
The arrangement allows the government to access dollar liquidity using naira-denominated Federal Government bonds as collateral. The DMO has said the facility was secured through First Abu Dhabi Bank and that neither oil revenues nor strategic national assets were pledged. Trust Radio+1
There is, however, a maturity discrepancy worth noting. The World Bank’s report describes the transaction as having a three-year maturity, while the DMO’s public explanation describes the overall facility as having a six-year tenor. These descriptions should not be presented as identical without further clarification.
Nigeria also raised $2.35 billion through a dual-tranche Eurobond issuance in November 2025. The Debt Management Office confirmed that the offer comprised a $1.25 billion 10-year bond and a $1.1 billion 20-year bond, with respective yields of 8.6308 per cent and 9.1297 per cent. dmo.gov.ng
The World Bank identified Nigeria as the third-largest sovereign bond issuer in its regional comparison.
Debt servicing and borrowing costs
The World Bank’s report also highlighted the pressure of servicing Nigeria’s external obligations.
Nigeria’s external debt-to-exports ratio stood at 212 per cent in 2025, while external debt represented 51.5 per cent of gross national income.
Debt service consumed 19.3 per cent of export earnings during the year, compared with 17.6 per cent in 2024. International Debt Statistics
The cost of new borrowing also varied significantly depending on the source of financing.
Nigeria’s average interest rate on new borrowing from official creditors was 1.9 per cent in 2025, compared with 9.6 per cent for private creditors.
Official financing carried an average maturity of 25 years and a five-year grace period, while private creditor financing had an average maturity of 12 years and an eight-year grace period, according to the report.
The difference highlights the higher cost of accessing commercial financing compared with borrowing from official development institutions.
Developing countries’ external debt hits $9.4tn
Nigeria’s debt position comes amid a broader increase in external borrowing across developing economies.
The World Bank said external debt across low- and middle-income countries rose by 5.5 per cent to a record $9.4 trillion in 2025, the fastest annual increase since 2021.
Debt-service payments across these countries reached $1.4 trillion, representing a fifth consecutive year of increases.
Haishan Fu, the World Bank Group’s chief statistician and director of development data, said the return of private lending was welcome but warned that borrowing costs were placing additional pressure on developing economies.
“The return of private lending to low- and middle-income countries is welcome, but these countries are borrowing more, paying more, and in many cases leaving less for long-term development,” Fu said. World Bank
The institution warned that rising debt-service obligations could leave governments with fewer resources for essential public services and long-term development investments.
