Nigeria’s rising debt burden is becoming increasingly concentrated at the centre, with the Federal Government now accounting for more than half of the country’s total public debt through domestic borrowing alone.
Fresh figures from the Debt Management Office (DMO) show that as of September 30, 2025, Federal Government domestic debt represents 50.76 per cent of Nigeria’s total public debt stock.
According to the DMO, Nigeria’s total public debt stood at N153.29tn as of September 2025. Domestic debt accounted for N81.82tn, representing 53.37 per cent of the total, while external debt stood at N71.48tn, or 46.63 per cent.
A closer look at the domestic component reveals a significant imbalance. Of the N81.82tn domestic debt, the Federal Government alone owes N77.81tn. States and the Federal Capital Territory share a combined domestic debt of about N4tn.
In percentage terms, the Federal Government accounts for about 95 per cent of total domestic debt, leaving states and the FCT with roughly 5 per cent.
Year-on-year data shows a notable expansion in Nigeria’s debt profile. In September 2024, total public debt was N142.32tn. Within one year, it increased by nearly N11tn to N153.29tn.
Domestic debt rose from N73.43tn in 2024 to N81.82tn in 2025. The Federal Government’s domestic debt increased from N69.22tn in 2024, when it represented 48.64 per cent of total debt, to N77.81tn in 2025, pushing its share to 50.76 per cent.
Meanwhile, the share attributable to states and the FCT declined slightly from 2.96 per cent in 2024 to 2.61 per cent in 2025. Analysts suggest this may reflect tighter borrowing controls at the subnational level, revenue limitations, or restricted access to domestic capital markets.
External debt also increased during the period. Nigeria’s external debt rose from $43.03bn in September 2024 to $48.46bn in September 2025. In naira terms, this translated from N68.89tn to N71.48tn, partly influenced by exchange rate adjustments used by the DMO.
Although domestic debt remains the larger share of the overall portfolio, the steady rise in external obligations adds further fiscal pressure.
Economic analysts warn that the growing concentration of debt at the federal level may have implications for fiscal sustainability. Increased domestic borrowing could crowd out private sector access to credit, raise interest rates and elevate debt servicing costs.
With debt servicing already consuming a significant share of federal revenue, concerns are mounting about shrinking fiscal space for infrastructure, social services and development projects.
The latest figures underscore that Nigeria’s debt challenge is increasingly a federal burden. As Abuja carries over half of the nation’s total debt through domestic obligations alone, attention is turning to how effectively borrowed funds are utilised and whether revenue growth can keep pace with rising liabilities.
