Nigeria Economic Update, Issue 15

According to recent data from the Debt Management Office (DMO), Nigeria’s total public debt stood at ₦159.28 trillion in December 2025, up from ₦153.29 trillion in September 2025, representing a quarterly increase of ₦5.99 trillion (3.90%). A year-on-year comparison shows that total public debt rose by ₦14.61 trillion from ₦144.67 trillion in December 2024, representing a 10.10 percent rise over the period. A breakdown of the debt stock in December 2025 indicates that external debt amounted to ₦74.43 trillion, accounting for 46.73 percent of total public debt. Of this amount, the Federal Government held ₦66.27 trillion, while the States and the Federal Capital Territory accounted for ₦8.16 trillion. Domestic debt was higher at ₦84.85 trillion, representing 53.27 percent of the total, with the Federal Government responsible for ₦80.49 trillion and the States and the FCT for ₦4.36 trillion. This structure highlights the continued dominance of domestic borrowing and the significantly larger debt burden borne by the Federal Government relative to subnational governments. It also demonstrates a sustained reliance on borrowing to meet financing needs, with domestic instruments remaining the primary source of funding. To manage rising debt exposure, fiscal policy should prioritise enhanced non-oil revenue mobilisation to reduce dependence on borrowing, improve expenditure efficiency to contain recurrent spending pressures, and gradually increase reliance on concessional external financing to moderate debt servicing costs.