Nigeria’s public debt stock has surged to N166.79tn, rising by N7.44tn in just three months and underscoring the mounting financing burden confronting the Federal Government.
The latest figures from the Debt Management Office showed that the debt stock increased from N159.35tn at the end of March 2026 to N166.79tn by June 30.
At the current level, Nigeria’s public debt has risen by about N79.41tn, or 91 per cent, from the N87.38tn recorded in June 2023, shortly after President Bola Tinubu assumed office.
The latest debt stock is equivalent to $120.93bn, comprising $54.52bn in external debt and $66.41bn in domestic obligations, based on the Central Bank of Nigeria’s official exchange rate of N1,379.1842/$ at the end of June.
Domestic debt accounted for N91.59tn, or 54.91 per cent, of the total, confirming the increasing dependence on the local financial market to fund government operations.
The Federal Government remains overwhelmingly responsible for the debt burden, accounting for N152.77tn, while the 36 states and the Federal Capital Territory collectively owed about N14.01tn.
FG dominates borrowing
The DMO figures showed that the Federal Government’s external debt stood at N65.77tn, representing 39.44 per cent of the country’s total debt.
States and the FCT accounted for N9.42tn, or 5.65 per cent.
On the domestic side, the Federal Government owed N87tn, equivalent to 52.16 per cent of total public debt, while states and the FCT accounted for N4.59tn.
The figures effectively put the Federal Government at the centre of Nigeria’s borrowing programme, with its obligations accounting for more than nine-tenths of the country’s total public debt.
That concentration has significant implications for the government’s finances, particularly as interest rates remain high and debt-service costs compete with other spending priorities.
Bonds swallow bulk of FG domestic debt
FGN bonds remained the biggest component of the Federal Government’s domestic obligations, with outstanding bonds valued at N64.84tn.
That represents 74.53 per cent of the Federal Government’s N87tn domestic debt.
Naira-denominated FGN bonds accounted for N41.47tn, while securitised Ways and Means advances stood at N22.11tn.
Treasury Bills constituted another major component, with an outstanding value of N19.48tn, representing 22.39 per cent of FGN domestic debt.
Other obligations included N1.19tn in Sukuk, N122.45bn in savings bonds, N47.36bn in green bonds and N1.22tn in promissory notes.
The promissory notes comprised N206.82bn in naira-denominated instruments and N1.01tn in foreign-currency-denominated notes.
Debt almost doubles under Tinubu
The latest figures provide a striking measure of how rapidly Nigeria’s public debt has expanded since the current administration took office.
The DMO put total public debt at N87.38tn as of June 30, 2023.
Three years later, it stands at N166.79tn.
That represents an increase of almost N80tn.
The increase has been accompanied by a significant expansion in both domestic and external borrowing.
Between December 2023 and December 2025 alone, external debt rose from $42.49bn to $51.86bn, while domestic debt increased from N59.1tn to N89.4tn.
The latest quarterly increase means the debt trajectory remains upward despite the administration’s aggressive economic reform programme.
Government borrowing puts pressure on private sector
The growing dependence on domestic borrowing is particularly important for businesses and investors because the Federal Government is raising funds from the same financial system that supplies credit to the private sector.
Banks, pension funds, asset managers and other institutional investors are major participants in the government securities market.
When government offers attractive yields on its bonds and Treasury Bills, financial institutions have a strong incentive to allocate funds to sovereign instruments rather than riskier lending to businesses.
That can make credit more expensive for manufacturers, SMEs and other private-sector operators.
It also helps explain why Nigeria’s interest-rate environment remains a critical concern for investors and businesses.
For investors, however, the other side of the equation is that heavy government borrowing creates a large supply of relatively attractive fixed-income instruments.
Revenue remains the critical test
The size of Nigeria’s debt is only part of the problem.
The more important question is whether government revenue is growing quickly enough to service the obligations without squeezing expenditure on infrastructure, education, healthcare and other essential services.
That is where Nigeria’s fiscal challenge becomes more serious.
A country can sustain a substantial debt stock if it has strong revenues, rapid economic growth and a manageable cost of borrowing. Nigeria’s historically weak revenue mobilisation, however, means that debt-service obligations can consume a significant portion of available government resources.
The Tinubu administration has responded with measures aimed at expanding the tax base, improving revenue collection and reducing costly subsidies.
The success of those measures will increasingly determine whether the country’s rising debt stock becomes a financing tool for economic expansion or a growing constraint on public finances.
Borrowing must now produce growth
With the debt stock approaching N167tn, the central issue is no longer simply whether Nigeria should borrow.
It is what the country gets in return for every naira borrowed.
Borrowing to finance infrastructure, power, transport, industrial capacity and other projects capable of expanding the productive base can potentially generate the economic activity and future revenue needed to repay the debt.
Borrowing to finance recurrent expenditure, plug fiscal holes or refinance old obligations without improving revenue capacity presents a much more difficult proposition.
The latest figures therefore put the spotlight squarely on the quality of government spending.
Nigeria’s public debt has almost doubled since June 2023. The government must now demonstrate that the borrowing is translating into stronger economic growth, higher productivity and increased revenue.
Otherwise, the rising debt stock will increasingly compete with the private sector for scarce capital, keep pressure on interest rates and leave future administrations with an even narrower fiscal space.
