Debt: Expert Reacts as Nigerians Beg World Bank Not To Approve FG’s New $1.2bn Loan Request
- Economists have raised concerns about Nigeria's debt level, describing it as a high-risk fiscal state
- They warned that the improvement is necessary despite stability in some critical debt measures
- Nigerians have taken to social media, urging the World Bank to reject the proposed $1.2 billion loan request
Legit.ng journalist Dave Ibemere has over a decade of experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
The Nigerian Economic Summit Group has cautioned that Nigeria still faces a high-risk fiscal environment despite a decline in its debt burden index (DBI) in 2024.
The new concerns come as the federal government plans to borrow $1.2 billion from the World Bank.
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NESG on public debt
In its latest Debt Burden Monitor report, titled 'Debt pressure persists beneath surface stability: DBI signals elevated fiscal strain in 2025', NESG noted that the country's fiscal position is unstable due to rising debt service costs, declining revenue mobilisation, and sustained debt financing.
As the report indicated, Nigeria’s debt burden index has fallen from 83.6 in 2023 to 70.9 in 2024, indicating a slight reprieve in debt stress.
The group, however, observed that these gains reflect "neither strong fiscal capacity nor broad-based reforms".
The group said:
"Although, on face value, this indicates a decline in debt stress. Nevertheless, these gains reflect partly the slight moderation in debt service stress and not in fundamental fiscal capacity of the Nigerian economy."
The NESG pointed out that Nigeria's public debt to GDP ratio has climbed from 37.4% in 2023 to 40.6% in 2024 on account of sustained debt financing by the government in the bid to bridge the revenue gap and close deficits.
The association noted that a sustained rising public debt to GDP ratio while the DBI has fallen, clearly shows that the Nigerian economy is highly vulnerable from a fiscal perspective.
It projects a persistently elevated debt pressure for 2025, with the DBI fluctuating within a high-stress band, Punch reports.
The report read:
"This pattern indicates that debt pressure has not structurally eased but instead fluctuates within a high-stress band."
Nigeria's debt level: expert insight
The Debt Management Office that Nigeria's total public debt had soared to N159.28 trillion by December 31, and that the government's debt service obligations grew to approximately N16 trillion in the same period
Economist, Bismarck Rewane, described Nigeria's debt burden as a major concern given the weak revenue base and increasing repayment obligations, and explained that borrowing is acceptable if funds are invested into productive sectors that can stimulate growth and enhance government revenue.
He said:
"The problem is not just borrowing, but what the loans are used for. If the money is invested properly in infrastructure, production and economic expansion, it can support growth. But when revenues remain weak, debt pressure will continue to increase."
Source: Facebook
Nigerians appeal to the World Bank
Meanwhile, Nigerians on social media have voiced their objections to the proposed borrowing plan, calling on the World Bank to deny the loan request.
They lamented the increasing economic hardship, surging inflation, and lack of transparency regarding past loans.
A user identified as @desirecrib stated:
"Stop borrowing the president of Nigeria money, he is looting the country into oblivion."
@benkill20018 said:
"Don't give them that money, Nigerians are suffering already."
@captbobby101 commented:
"Please do not approve any loan again. Nigerians are already struggling."
@realkinggdavid said:
"Please don't give Tinubu loan again please, people are suffering too much in the country."
@precious2291 pleaded with the World Bank:
"Please stop borrowing our president."
10 states with highest foreign debts
Earlier, Legit.ng reported that the National Bureau of Statistics has revealed that Nigeria's total external debt stock climbed to $51 billion (N74.43 trillion) in the fourth quarter of 2025.
According to its latest public data report, Lagos State has emerged as Nigeria’s most indebted subnational government in terms of external borrowing.
Lagos recorded the highest external debt profile at $1.17 billion, far ahead of other states.
Source: Legit.ng
