Nigeria’s Debt Servicing Outpaces Combined Health and Education Spending by Fivefold

A newly released report has highlighted a stark imbalance in Nigeria’s national budget, revealing that the country spends nearly five times more on servicing external debt than it does on healthcare and education combined.

The analysis, conducted by an international advocacy organization, provides a critical assessment of the country’s economic trajectory and the influence of external financial institutions. According to the findings, Nigeria currently allocates approximately 20.1 percent of its national revenue toward debt servicing. In contrast, health and education receive only 4.06 percent and 4.40 percent of revenue, respectively.

The report argues that for many lower-income nations, the burden of debt repayment has become the primary barrier to expanding essential public services. It further suggests that debt servicing is often prioritized as an “unalterable reality,” forcing social spending to take a secondary position in national fiscal planning.

The findings also scrutinize recent economic policy shifts in Nigeria, including the removal of fuel subsidies. The report claims that the compensatory measures introduced to protect vulnerable households were insufficient and implemented too late, ultimately forcing the government to reintroduce certain subsidy measures to address the resulting cost-of-living crisis.

Additionally, the study criticizes the country’s public-sector wage bill, which has remained frozen at 1.9 percent of the Gross Domestic Product for six consecutive years. This figure is noted as the lowest among the 11 countries surveyed and significantly below both the African and global averages. Experts involved in the study raised concerns over this stagnation, pointing out that it directly affects the funding for essential frontline workers such as teachers, nurses, and doctors.

The advocacy group further challenged recommendations made regarding taxation, specifically noting that proposals to increase the Value Added Tax to 15 percent by 2026 would place a disproportionate financial strain on low-income citizens. The report argues that such policies lack equity, as they do not include corresponding increases in taxes on the nation’s wealthiest individuals.

Concluding its assessment, the report calls for a fundamental shift in how international financial institutions approach economic advice for developing nations. It advocates for moving away from austerity-focused policies and toward frameworks that prioritize social investment, public service growth, and economic fairness for the general populace.