5 top sources of Nigeria's foreign debt

Nigeria has recently witnessed a spike in its debt volume and this has been linked to FG’s new borrowings made up of both domestic and foreign lending.

According to data from the Debt Management Office (DMO), as of December 2023, Nigeria’s public debt is estimated at ₦97.34 trillion ($108.23 billion).

The DMO data further revealed that 61% of the total debt comprised ₦59.12 trillion (US$65.73 billion) in domestic debt and ₦38.22 trillion (US$42.50 billion) in external debt representing 39% of the total debt.

Top sources of Nigeria's foreign debt

According to the DMO, here are some of Nigeria's top foreign lenders as of December 2023;

1. International Development Association (IDA)

The IDA is part of the World Bank Group. It allocates funds to countries according to their income levels and has a good record in managing the economies.

The IDA encourages projects that promote diversified growth and job creation, with a focus on youth, women, and the poor in marginalised areas, and social inclusion.

IDA credits carry no or low-interest charges.

As of December 2023, Nigeria’s debt to the IDA was $14.9 billion

2. China (Exim Bank of China)

The China Exim Bank has been at the forefront of several major developmental projects in Nigeria which include railway, power, and communication.

As of 2022, China became Africa’s biggest bilateral lender with Its public lenders holding almost $63 billion of Africa’s external debt while its private lenders held over $24 billion of Africa’s external debt.

As of December, Nigeria's debt to the Exim Bank of China was $5.17 billion.

3. International Monetary Fund (IMF)

The IMF during the COVID era, committed huge funds to aid the country's efforts to cushion the adverse aftereffects of COVID-19 and the fall in the price of oil.

The body however gave some conditions with its loans which include subsidy removal, scrapping of multiple exchange rates and downsizing of Nigeria’s civil service.

As of December 2023, Nigeria's debt to the IMF stood at $2.4 billion.

Top sources of Nigeria's foreign debt [Proshare Ng] Pulse Nigeria

4. African Development Bank (AfDB)

The AfDB has been involved in Nigeria’s agricultural revolution, especially in setting up the Special Agro-Industrial Processing Zone Program. The program targets Nigeria’s agriculture sector potential by promoting industrialisation through the development of strategic crops and livestock.

As of December 2023, Nigeria's debt to the AfDB stood at $1.6 billion.

5. African Development Fund

The ADF is the parent company of the African Development Bank and majorly contributes to the promotion of economic and social development in 38 least-developed African countries.

The FG, in November 2023, approved a $1 billion concessionary loan to support the budget and also to boost forex availability in the country.

As of December 2023, Nigeria's debt to the ADB stood at $1 billion.