Nigeria’s debt profile could hit a record high of over ₦182.9 trillion if the National Assembly approves President Bola Tinubu’s fresh loan request of $24.14 billion.
The new borrowing plan, submitted to lawmakers for approval, consists of $21.54 billion, €2.19 billion, and ¥15 billion. When converted using prevailing exchange rates — €1 = $1.1381 and ¥1 = $0.0068 — the euro and yen portions translate to roughly $2.5 billion and $102 million respectively, bringing the total package to $24.14 billion.
Using the official exchange rate of ₦1,583.74/$1, the loan could add about ₦38.24 trillion to Nigeria’s public debt stock.
As of December 31, 2024, Nigeria’s total public debt stood at ₦144.67 trillion, according to data from the Debt Management Office (DMO). This figure marked a 48.6% increase from the ₦97.34 trillion recorded at the end of 2023, largely driven by exchange rate volatility and increased borrowing.
The naira’s sharp depreciation inflated the local currency value of the country’s external debt, which jumped from ₦38.22 trillion ($42.5 billion) in December 2023 to ₦70.29 trillion ($45.78 billion) a year later — an 83.9% increase.
Domestic debt also rose significantly, climbing from ₦59.12 trillion to ₦74.38 trillion within the same period, a 25.8% rise. Of this, ₦70.41 trillion was owed by the Federal Government, while state and FCT debts fell from ₦5.86 trillion to ₦3.97 trillion.
If the proposed loans are approved and fully drawn, Nigeria’s external debt would rise to about $69.92 billion — a 52.7% increase — with the naira value of foreign debt potentially surpassing ₦108 trillion.
Financial experts have expressed concern over the implications of the new loans on the country’s debt sustainability. Johnson Chukwu, Group CEO of Cowry Assets Management Limited, said the issue was less about the size of the loan and more about its usage.
“What matters most is how the loan is utilized. If it funds infrastructure or projects that generate long-term value and economic growth, then it can be justified,” Chukwu said.
He warned, however, that borrowing without a clear strategy or return on investment could worsen Nigeria’s fiscal position. “If the funds are mismanaged or funneled into unproductive ventures, then the country will simply be accumulating liabilities that future generations will have to pay for.”
The proposed loans come at a time of heightened public scrutiny over government spending and rising concerns about Nigeria’s capacity to repay its obligations without compromising essential public services.
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