Nigeria’s 2025 Debt Payments Leave Limited Funds for Trade and Imports

In a sign of mounting pressure on the nation’s finances, Nigeria directed about $5.2 billion of its foreign exchange resources to servicing external loans in 2025 — a move that consumed more than 70 per cent of total international payments for the year.

The figures reveal that while total international outflows slightly declined from 2024 levels to roughly $7.22 billion, the proportion spent on external debt service climbed sharply. This shift means that nearly three‑quarters of Nigeria’s available foreign exchange for international transactions was used to meet debt obligations rather than fund trade or imports.

The pressure was most acute in months with larger loan repayments, especially in November 2025, when about $1.31 billion of the $1.49 billion in total foreign payments went to service loans. Other months saw variation, with significantly smaller sums paid out at certain times of the year.

Although early 2026 figures show a slight reduction in external debt service as a share of total payments compared with 2025, debt obligations continue to dominate Nigeria’s use of its foreign exchange reserves.

Analysts say this trend underscores deeper fiscal constraints, coming at a time when the government is also working to stabilise the naira, boost revenues, and expand productive sectors of the economy.