By Peter Omopo
Abuja | June 28, 2025 — Nigeria’s total public debt rose to ₦149.39 trillion in the first quarter of 2025, according to data released on Friday by the Debt Management Office (DMO). The figure represents a ₦27.72 trillion or 22.8% increase compared to ₦121.67 trillion recorded in the same period last year.
On a quarterly basis, the debt stock also climbed by ₦4.72 trillion or 3.3% from ₦144.67 trillion in December 2024.
The DMO attributed the continued rise in public debt to fresh borrowings by the Federal Government and the depreciation of the naira, which significantly raised the naira value of Nigeria’s external debt portfolio.
External Debt Surges Amid Naira Weakness
Nigeria’s external debt reached ₦70.63 trillion ($45.98 billion) as of March 31, 2025—up from ₦56.02 trillion ($42.12 billion) recorded in Q1 2024. This reflects a year-on-year increase of ₦14.61 trillion or 26.1%. On a quarterly basis, the external debt rose marginally by ₦344 billion or 0.5% from ₦70.29 trillion in December 2024.
While the increase in dollar-denominated debt was relatively moderate at $3.86 billion year-on-year, the weakening of the naira sharply inflated the debt when converted into local currency.
For comparison, the Central Bank of Nigeria used an exchange rate of ₦1,330.26/$1 to convert external obligations in Q1 2024. Although the DMO did not specify the exchange rate used in Q1 2025, the elevated naira figures suggest a much weaker exchange rate due to ongoing currency volatility.
Rising Debt Service Burden
The swelling debt stock comes at a time of heightened fiscal pressure for the government, which continues to rely on both domestic and foreign borrowing to finance budgetary shortfalls.
Nigeria’s external debt includes obligations to multilateral institutions like the World Bank and African Development Bank, bilateral partners, and commercial lenders via Eurobonds and other debt instruments.
Analysts warn that the naira’s depreciation is driving up the cost of debt servicing, placing additional strain on public finances at a time when the country is battling to stabilise its foreign exchange market and revive economic growth.
As the debt burden grows, calls are mounting for more sustainable fiscal strategies to reduce reliance on borrowing and improve revenue generation through tax reforms and economic diversification.
