Debt profile dropped under Tinubu – NOA explains

By Omodele Adigun

The National Orientation Agency (NOA) says Nigeria’s debt profile has dropped significantly since President Bola Tinubu assumed office in 2023.

The agency challenged widespread misconceptions, citing data from the Debt Management Office (DMO), Central Bank of Nigeria (CBN), and other credible sources in an October 24 explainer.

As of June 2023, Nigeria’s total public debt stood at $113.42 billion, with a debt-to-GDP ratio below 40 percent, deemed sustainable by the IMF and World Bank. The NOA projects the debt will drop to around $94.22 billion by December 2024, representing a reduction of over $19 billion in 18 months.

However, Nigeria’s public debt rose to N152.39 trillion as of June 30, according to an October 12 report by the DMO, representing a N3 trillion increase from the first quarter.

The NOA said in a report posted on its official X page on Monday, “The reduction in Nigeria’s debt shows that the federal government is actively managing its borrowings and repayments.

“Instead of accumulating more debt, Nigeria has been making down payments of some of its loans and avoiding unnecessary new borrowings. This is a positive sign of fiscal responsibility.”

Prior to Tinubu’s presidency, debt servicing accounted for nearly all of the federal government’s revenue. As of early 2023, approximately 97 percent of federal revenue was dedicated to debt servicing, limiting funding for essential public services.

The NOA commended the government’s commitment to meeting its debt obligations, citing the repayment of a $3.26 billion IMF loan within two years and roughly $7 billion spent on external debt servicing in the administration’s first 18 months.

“By the end of 2024, this ratio had improved to 68 percent, and it had reduced to less than 50 percent by the second quarter of 2025.

“While still high, this is a significant improvement, showing better fiscal management and increased government revenue,” the agency said.

The NOA said the federal government has demonstrated a strong commitment to meeting its debt obligations, exemplified by repaying a $3.26 billion IMF loan within two years and spending around $7 billion on external debt servicing in the first 18 months of the Tinubu administration.

The agency said that despite manageable debt, Nigeria faces economic difficulties due to over-reliance on volatile oil revenue, but the government is working to boost non-oil revenue through improved tax collection and reduced leakages.

According to the Debt Service Management of Nigeria (DSMN) report, Nigeria spent 4.1 percent of its Gross Domestic Product on debt servicing in 2024, according to the latest Country Focus Report by the African Development Bank.

The figure represents an increase from 3.7 percent recorded in 2023 and reflects the rising cost of borrowing amid tightening global financial conditions and high domestic interest rates.

According to the report, the increase in debt service obligations was driven by higher interest payments on government securities and fresh borrowings to finance the budget deficit.

It continued that the increased expenditure was largely driven by debt servicing costs, which took up a bigger chunk of public finances despite recent fiscal reforms.

Public debt jumped to 52.3 percent of GDP in 2024, up from 41.5 percent in 2023, mainly due to higher financing needs and a weaker naira.