Fresh concerns have emerged over Nigeria’s debt burden with the outlook for 2026 indicating new borrowings at about N29 trillion.
Giving its verdict on the debt situation, the Nigerian Economic Summit Group (NESG), Nigeria’s foremost economic think-tank, in the May 2026 edition of its Debt Burden Monitor released yesterday, said that debt pressure is persisting beneath surface stability, adding that Debt Burden Index (DBI) is signaling elevated fiscal strain.
“Headline indicators suggest a degree of stabilisation, yet underlying fiscal pressures remain elevated when assessed through a more comprehensive lens”.
Explaining the situation further in a historical perspective, NESG stated: “In 2024, the Debt Burden Index (DBI) declined to 70.9 points from a peak of 83.6points in 2023. At face value, this suggests an easing of debt stress. “However, this improvement was largely driven by a partial moderation in debt service pressures, rather than a fundamental strengthening of fiscal capacity.
“At the same time, public debt-to-GDP rose sharply to 40.6 percent, reflecting continued reliance on borrowing to finance fiscal deficits and structural revenue weaknesses.
“This divergence highlights a central issue that the underlying fiscal vulnerability remained significant.
“The 2025 DBI trajectory reinforces concerns. Quarterly estimates show that the DBI remains elevated and volatile, rising to 78.4 points in Q1’25 and peaking at 79.6 points in Q2’25 before moderating to 76.2 points in Q3’25 and closing the year at an estimated 79.2 points in Q4’25.
‘’This pattern indicates that debt pressure has not structurally eased but instead fluctuating within a high-stress band.
“Overall, the 2024–2025 transition does not yet reflect a decisive shift toward
debt sustainability. Rather, it signals a system making only marginal adjustments, with improvements in headline ratios masking persistent structural imbalances.
“The DBI captures this reality more effectively, signalling that Nigeria remains in a high-risk fiscal environment despite apparent stabilisation in conventional indicators”, NESG concluded.
As of early 2026, Nigeria’s total public debt stood at N159.28 trillion with $51.86 billion as external debt, as of December 31, 2025.
Analysts are projecting a rise toward N180 to N200 trillion in the medium term.
The 2026 fiscal plan features a budget of N68.32 trillion, with a deficit of over N20 trillion set to be funded by new borrowing.
Actual new borrowing is approximately N17.8 trillion to N29.2 trillion, reflecting increased fiscal requirements.
Nigeria’s 2026 fiscal outlook came under sharp scrutiny after the Federal Government raised its borrowing plan to N29.2 trillion, far above the earlier projection of N17.89 trillion.
With total expenditure now estimated at N68.32 trillion and projected revenue at N36.87 trillion, the widening deficit is renewing concerns about debt sustainability, rising debt service obligations, inflation risks, exchange rate pressures, and the possible squeeze on private-sector credit.
Also the 2026 debt service is estimated at N15.5 trillion to N15.9 trillion.
