Nigeria’s private sector foreign debt rise 179.6% to $54.5bn — World Bank
By Babajide Komolafe
The World Bank has reported a significant increase in the foreign debt of Nigerian companies, which surged by 179.6 percent over the past seven years, reaching $54.48 billion in 2025, up from $19.49 billion in 2018. This marks a near tripling of the amount owed to foreign lenders by Nigerian businesses since 2018.
The data was disclosed in the World Bank’s International Debt Report 2026, which noted that as of December 2025, Nigeria’s private sector nonguaranteed external debt stood at $54.476 billion. The report defines total external debt as the sum of public and publicly guaranteed debt, private nonguaranteed debt, and short-term debt.
Private sector nonguaranteed external debt consists of funds borrowed by private firms from foreign banks, investors, and other lenders without governmental or public institution guarantees. The report elaborated that this type of debt is classified as long-term external obligations not guaranteed by a public entity.
In contrast, public and publicly guaranteed external debt includes long-term obligations from all public debtors, including central government liabilities and those of state-owned enterprises. Short-term debt is categorized as obligations with an original maturity of one year or less.
The increase in private sector debt outpaced the rise in government-backed external debt, which climbed 155.5 percent, increasing from $24.422 billion in 2018 to $62.4 billion by 2025. The World Bank’s findings indicate that foreign debt among private companies is becoming an increasingly significant component of Nigeria’s overall external debt burden.
In 2018, private sector nonguaranteed debt represented approximately 79.8 percent of the country’s public and publicly guaranteed external debt. By 2025, this figure had grown to 87.3 percent. Overall, Nigeria’s total external debt—including government borrowing, private loans, and short-term liabilities—rose from $46.238 billion in 2018 to $145.015 billion in 2025.
The report also highlighted the escalating costs associated with borrowing from private foreign lenders. New loans secured by Nigeria from these sources in 2025 carried an average interest rate of 9.6 percent, compared to just 1.9 percent for loans from official creditors, which include foreign governments and multilateral institutions. Furthermore, loans from private lenders typically had an average repayment period of 12 years, while those from official creditors often extended to 25 years.
