Nigeria’s external debt hits N66.14 trillion in Q3 2024

The Central Bank of Nigeria (CBN) has revealed that Nigeria’s external debt stock climbed to N66.14 trillion ($43.03 billion) in Q3 2024, accounting for 23.14% of the country’s GDP.

This marks a 0.30% increase from the $42.90 billion recorded in Q2 2024 and a 3.40% year-on-year (YoY) rise from $41.59 billion in Q3 2023.

The steady increase highlights Nigeria’s growing reliance on foreign loans to bridge fiscal deficits and finance development projects.

Breakdown of Nigeria’s external debt stock

A breakdown of Nigeria’s foreign borrowing shows diverse sources, including:

• Multilateral Loans – $21.77 billion (50.60%), sourced from the World Bank, IMF, and African Development Bank.
• Commercial Loans – $15.12 billion (35.14%), largely from Eurobonds.
• Bilateral Loans – $5.81 billion (13.50%), obtained from foreign governments.
• Syndicated Loans – $0.33 billion (0.76%), secured through the African Finance Corporation.

Debt servicing: Nigeria paid $1.34 billion in Q3 2024

Nigeria serviced $1.34 billion in external debt obligations by the end of September 2024, covering both principal repayments and interest.

• Principal repayments accounted for $0.72 billion (53.73%).
• Interest payments totaled $0.62 billion (46.27%), with:
  • Commercial Borrowings (Eurobonds) taking the largest share – $0.44 billion (70.96%).
  • Multilateral Institutions accounting for $0.12 billion (19.35%).
  • Bilateral Loans covering the remaining balance.

Implications and economic outlook

The rising debt stock reflects Nigeria’s continued dependence on external borrowing amid economic challenges. Analysts warn that high debt servicing costs could strain government finances, making it harder to invest in critical sectors like infrastructure, health, and education.

While the CBN expects foreign loans to play a crucial role in bridging budget deficits, experts caution that Nigeria must prioritize revenue generation and debt sustainability to avoid long-term fiscal distress.