The Federal Government has approved Nigeria’s Medium-Term Debt Management Strategy (MTDS) for 2024–2027 to sustain debt, stabilize finances, and deepen markets.
The Debt Management Office (DMO) confirmed the approval on Saturday, noting the Federal Executive Council’s endorsement. The MTDS was developed with support from the World Bank and International Monetary Fund (IMF).
According to the DMO statement, the strategy aims to balance financing needs with debt sustainability, while minimizing risks and borrowing costs. It also targets an optimal public debt portfolio and further development of domestic securities through new financial products.
Under the new plan, the debt-to-GDP ratio is projected to peak at 60% by 2027, up from 52.25% in 2024. Interest payments-to-GDP will be capped at 4.5%, while sovereign guarantees-to-GDP will not exceed 5%. The domestic-to-external debt mix will be adjusted to 55:45 to limit foreign exchange risk exposure.
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The strategy also mandates that no more than 15% of total debt matures in a year. Average time to maturity will be extended to a minimum of 10 years. Foreign exchange-denominated debt will be capped at 45% of total public debt, down from the current 51.75%.
The DMO explained that consultations with the Central Bank of Nigeria and Federal Ministry of Finance shaped the MTDS. Technical support from the World Bank and IMF aligned the plan with global best practices.
The government expects the strategy to reassure investors, credit rating agencies, and development partners of Nigeria’s commitment to prudent debt management and fiscal responsibility.
In 2021, the government adopted a similar plan covering 2020–2023, signaling a continued focus on reducing refinancing risks and prioritizing domestic borrowing.
The MTDS remains a widely recognized framework for guiding debt operations and ensuring fiscal discipline in emerging economies.
