Nigeria’s public debt is projected to climb to N160.6 trillion by December 2025, driven by intensified borrowing to address a growing fiscal deficit, according to a new economic outlook report by CSL Stockbrokers Limited, a subsidiary of FCMB Group Plc. The report warns that this escalation, equivalent to 50.2% of Nigeria’s pre-rebased GDP, underscores deepening concerns about the nation’s fiscal sustainability.
The Federal Government is expected to borrow at least N9.3 trillion in the second half of 2025 to bridge a fiscal gap projected to widen to 5.8% of GDP, exceeding the budgeted 3.9%. This increase is fueled by shortfalls in oil and non-oil revenues. Nigeria’s oil production averaged 1.67 million barrels per day from January to May, falling short of the 2.06 million barrels per day target, while oil prices averaged $70.82 per barrel, below the $75 benchmark. Additionally, delays in tax reforms, including a stalled VAT increase from 7.5% to 10% and postponed tax legislation, have limited non-oil revenue.
The report highlights concerns over the Nigerian National Petroleum Company Limited’s remittance of only half of fuel subsidy savings to the Federation Account, further straining fiscal resources. To address these challenges, the government plans to increase borrowing through domestic and external markets, including a $25 billion medium-term borrowing plan and potential Eurobond refinancing in November.
As of March 31, 2025, Nigeria’s public debt stood at N149.39 trillion, up 22.8% from N121.67 trillion a year earlier, per the Debt Management Office. The naira’s depreciation has inflated the value of external debt, while new borrowings fund infrastructure, debt servicing, and recurrent spending. Although GDP rebasing may lower the debt-to-GDP ratio to 50.7% by year-end, CSL cautions that this masks underlying sustainability risks.
Analysts warn that without addressing revenue shortfalls and improving fiscal discipline, Nigeria’s rising debt could jeopardize its $1 trillion economy goal by 2030. The government faces pressure to balance borrowing with sustainable revenue strategies to ensure long-term economic stability.
