Nigeria paid five times higher interest on fresh foreign loans obtained from private creditors compared to official lenders in 2025, according to findings by Punch citing the World Bank.
Borrowing costs from commercial financiers averaged 9.6 percent, while official institutions offered credit at an average rate of 1.9 percent. The sharp gap highlighted the expensive nature of international capital markets as the country’s overall external debt stock climbed to $145.02 billion.
Data from the World Bank's latest International Debt Statistics showed that Nigeria's foreign debt grew by 6.6 percent in 2025. This rise extended a continuous 10-year upward climb from the $83.21 billion recorded in 2015, representing an addition of roughly $61.8 billion across the decade.
Beyond the steep rates, terms from official lenders proved far more favorable. Official loans carried an average repayment lifespan of 25 years alongside a five-year grace period, whereas private loans had a shorter average maturity of 12 years and an eight-year grace window.
The structure of the nation's debt revealed that public and publicly guaranteed obligations stood at $62.40 billion, private nonguaranteed debt totaled $54.48 billion, and short-term debt made up $28.14 billion. Within public debt, multilateral institutions accounted for $31.37 billion, bilateral partners held $6.68 billion, and commercial lenders claimed $24.35 billion.
The International Development Association, the concessionary arm of the World Bank, remained Nigeria’s top multilateral creditor with $18.53 billion. For bilateral funding, China led the pack with $5.67 billion, followed by France at $774 million and other bilateral partners at $237 million.
Servicing these obligations continued to weigh on foreign exchange receipts. The country’s debt service-to-export ratio expanded by 9.6 percent to reach 19 percent, while debt service relative to gross national income climbed to five percent. Even though external debt dropped to 51 percent of gross national income, debt service burdens continued to climb.
Commenting on global debt tracking, World Bank Group Chief Statistician Haishan Fu noted that systematic reconciliation between borrower records and bilateral creditor reports since 2022 has enhanced transparency and helped eliminate data discrepancies across developing economies.
