Debt Servicing to Gulp Over Half of Nigeria’s Revenue – IMF

The International Monetary Fund (IMF) has projected that Nigeria will spend more than half of its government revenue on debt servicing in 2026, highlighting the growing pressure of interest payments on public finances.

In its latest country assessment, the IMF estimates that interest payments will consume 53.7 percent of federal government revenue in 2026, up slightly from 53.2 percent in 2025 and 40.8 percent in 2024. The Fund expects the ratio to ease marginally to 52.4 percent in 2027.

Despite the rising debt-service burden, the IMF maintained that Nigeria’s debt remains sustainable. Speaking on ARISE Television, the IMF’s Resident Representative for Nigeria, Christian Ebeke, said the country is not considered a high-risk debt-distressed economy.

“Nigeria’s debt is sustainable, and the risk of sovereign debt distress is moderate,”

Ebeke said, noting that the country’s debt-to-GDP ratio remains in the mid-30 percent range and compares favourably with many peer economies.

The IMF also projected improvements in key macroeconomic indicators, forecasting average inflation of 16 percent in 2026 and a rise in Nigeria’s gross international reserves from $40.2 billion in 2024 to $58.1 billion in 2026 and $62 billion in 2027.

According to the Fund, Nigeria’s debt portfolio benefits from a balanced mix of domestic and external borrowing, as well as relatively long debt maturities