Nigeria committed $2.86 billion to service its external debt obligations between January and August 2025, according to new data released by the Central Bank of Nigeria (CBN) on Wednesday.
This figure represents 69.1 per cent of the country’s total foreign payments of $4.14 billion during the period.
In the same timeframe last year, the nation spent $3.06 billion on debt servicing, which amounted to 70.7 per cent of its $4.33 billion total foreign payments. While this year’s debt repayments are $198 million lower than in 2024, debt obligations still account for nearly seven out of every ten dollars leaving the country.
A closer look at the monthly figures shows fluctuating repayment patterns. January 2025 recorded $540.67 million compared with $560.52 million in January 2024. February 2025 stood at $276.73 million, slightly down from $283.22 million the previous year. Debt service payments spiked in March 2025 to $632.36 million, a sharp rise from $276.17 million in March 2024.
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The upward trend continued in April 2025 with $557.79 million, far higher than the $215.20 million spent in April 2024. However, in May 2025, payments fell significantly to $230.92 million, compared with $854.37 million in May 2024. June 2025 rose to $143.39 million from $50.82 million in June 2024, while July 2025 dropped to $179.95 million from $542.5 million in the same month last year. By August 2025, debt servicing stood at $302.3 million, slightly above the $279.95 million spent in August 2024.
The data also reveal sharp month-to-month swings in 2025. Spending fell from $540.67 million in January to $276.73 million in February, before surging to $632.36 million in March. It then fell again to $557.79 million in April, plunged to $230.92 million in May, slipped further to $143.39 million in June, rebounded to $179.95 million in July, and climbed to $302.3 million in August.
Despite a slight year-on-year decline in debt servicing, the dominance of debt payments in Nigeria’s foreign obligations underscores the strain on external reserves and the limited space for critical imports or investment.
Fitch Ratings recently projected that Nigeria’s external debt service would rise from $4.7 billion in 2024 to $5.2 billion in 2025, comprising $4.5 billion in amortisation payments and a $1.1 billion Eurobond repayment scheduled for November. Fitch noted, “Government external debt service is moderate but expected to rise to $5.2bn in 2025 (with $4.5bn of amortisations, including a $1.1bn Eurobond repayment due in November 2025), from $4.7bn in 2024, and fall to $3.5bn in 2026.”
The ratings agency also highlighted a minor delay in the March 28, 2025 Eurobond coupon payment as evidence of Nigeria’s ongoing fiscal pressures. While debt remains within manageable levels, concerns persist over high borrowing costs, weak revenue inflows, and limited fiscal space.
According to Fitch, government debt is expected to remain around 51 per cent of GDP in 2025 and 2026. However, it warned that interest payments will continue to consume a large share of revenue.
It stated, “We expect general government revenue-to-GDP to rise but to remain structurally low (averaging 13.3 per cent in 2025–2026), largely accounting for a high general government interest/revenue ratio, above 30 per cent, with the Federal Government interest/revenue ratio of nearly 50 per cent.”
