CBN Data Reveal Nigeria Spent Almost $1 Billion on Foreign Debt Servicing in Two Months

 

By Abdulahi Musa 

Nigeria spent almost $1 billion servicing its foreign debt in the first two months of 2026, highlighting the growing burden of external loan repayments on the country's finances.

Data obtained from the Central Bank of Nigeria (CBN) showed that the Federal Government paid about $920 million between January and February 2026 to meet its foreign debt obligations. The sharp increase in debt servicing reflects rising capital outflows and mounting pressure on the country's foreign exchange reserves. 

The development comes amid concerns over Nigeria's growing debt profile and the increasing proportion of government revenue being used to service existing loans instead of funding infrastructure, healthcare, education and other critical sectors.

Economic analysts have warned that the rising cost of servicing foreign loans could limit the government's fiscal flexibility, especially as authorities continue to rely on borrowing to finance budget deficits and development projects. They stressed the need to boost revenue generation, expand exports and reduce dependence on external borrowing. 

The latest figures also underscore the challenge facing policymakers as Nigeria seeks to balance debt sustainability with the need to finance economic growth. While the government has maintained that its borrowing is targeted at infrastructure and productive investments, experts argue that the pace of debt servicing has become a major concern.

The Federal Government has consistently maintained that Nigeria's debt remains sustainable, insisting that the focus should be on improving revenue generation rather than the size of the country's debt stock. However, economists say the increasing debt service bill is evidence of the pressure on public finances and the need for stronger fiscal reforms.