Nigeria spent about ₦27.2 trillion on debt servicing between 2024 and 2025, exceeding capital expenditure by ₦3.9 trillion and highlighting mounting fiscal pressure on the federal budget.
Debt servicing in Nigeria exceeded capital expenditure by ₦3.9 trillion over the past two years, underscoring growing fiscal pressure on the federal budget, according to a media brief obtained by The Punch from the Federal Ministry of Finance. The document revealed that the Federal Government spent about ₦27.2 trillion servicing public debt between 2024 and 2025.
The brief, prepared by the Special Adviser to the Minister of Finance and Coordinating Minister of the Economy on Media and Communications, Ogho Okiti, attributed the sharp rise in debt servicing costs largely to macroeconomic adjustments, particularly the depreciation of the naira and higher domestic interest rates. According to the data, the government spent ₦12.63 trillion on debt servicing in 2024, significantly above the ₦8.56 trillion budgeted for the year, while payments rose further to ₦14.57 trillion in 2025, exceeding the ₦13.12 trillion initially approved.
A year-on-year comparison showed debt servicing increased by ₦1.94 trillion between 2024 and 2025, representing a 15.4 per cent rise. Overall, actual spending on debt obligations exceeded budget projections by about ₦5.52 trillion across the two years. The brief explained that the increase was largely driven by macroeconomic factors rather than new borrowing, stating: “External debt is denominated in foreign currency. When the naira depreciates, the naira cost of servicing the same dollar debt rises automatically. This is a valuation effect and not evidence of new borrowing.”
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