Nigeria has spent $2.78 billion on foreign debt servicing in the first seven months of 2024, according to data from the Central Bank of Nigeria.
This amount accounts for 64% of the total $4.36 billion in international payments made by the Apex Bank on behalf of the Nigerian government between January and July 2024.
This marks a significant increase from the same period last year when 46% of total international payments were allocated to debt service, reflecting a 39.13% rise in 2024.
The growing share of debt servicing suggests that Nigeria’s foreign debt obligations have intensified, outpacing the overall increase in international payments.
The report indicates that the contributing factors may include a rise in total debt stock, higher interest rates on existing debt, or adjusted payment schedules requiring more immediate servicing.
January 2024 saw a sharp increase in external debt servicing payments, surging to $560.52 million—a 399% jump from $112.35 million in the same month of the previous year.
This accounted for 74% of the $757.41 million in total international payments for that month. While the debt servicing costs fluctuated in subsequent months, they remained a significant portion of Nigeria’s international payments.
In February, debt servicing amounted to $283.22 million, representing 67% of the $424.96 million in total international payments for the month, with a slight 2% decrease from February 2023. March 2024 saw a further drop in debt servicing to $276.17 million, down 31% from $400.47 million in the same month last year, making up 65% of the $424.71 million total international payments.
April recorded $215.20 million in debt servicing payments, which accounted for 47% of the $462.54 million in total international payments—a 132% increase from the $92.85 million paid in April 2023. June 2024 saw a temporary relief, with debt servicing costs falling to $50.82 million, just 14% of the $353.61 million in total international payments, marking the lowest percentage of the year.
However, this relief was short-lived as debt servicing surged again in July 2024 to $542.50 million, representing 78% of the $694.45 million in total international payments, though this was a 15% decrease from the $641.70 million paid in July 2023.
This trend indicates the mounting pressure on Nigeria’s financial resources due to increasing foreign debt obligations, posing significant challenges for economic management in the coming months.
This relief was again short-lived as July 2024 saw debt servicing rise to $542.50 million, which represented a substantial 78% of the $694.45 million total international payments. However, it was a 15% decrease compared to the $641.70 million paid in July 2023.
This overall rise highlights the escalating burden of debt servicing on Nigeria’s finances and highlights the growing challenge of managing the country’s external debt amid increasing global financial pressures.
Nigeria’s total debt servicing costs from January to July 2024,
reached $2.78 billion, marking a 19% increase from the $1.81 billion spent during the same period in 2023.
This surge underscores the escalating burden of debt servicing on Nigeria’s finances and the growing challenge of managing the country’s external debt in the face of rising global financial pressures.
It was previously reported that Nigeria spent about $1.12 billion on foreign debt service payments in the first quarter of 2024, highlighting the growing burden of external debt on the nation’s finances.
