Nigeria’s worsening debt burden has once again come under intense scrutiny after new figures from the 2025 amended budget implementation report revealed that the Federal Government spent about N12.63trillion on debt servicing between January and September 2025, while releasing only N3.10trillion for capital and infrastructural development within the same period.
The figures, sourced from the Office of the Accountant-General of the Federation and the Budget Office of the Federation, showed a troubling imbalance in government spending, with debt obligations consuming more than four times the amount allocated to critical infrastructure and development projects across the country.
According to the report, total debt service expenditure stood at N12.63trillion by the end of the third quarter of 2025, exposing the deepening fiscal crisis confronting Africa’s largest economy.
A breakdown of the debt servicing figures showed that domestic debt obligations accounted for N6.22trillion, while foreign debt servicing gulped approximately N6.29trillion during the nine-month period. In addition, the Federal Government spent N108.17billion on sinking fund payments, pushing total debt-related expenditure to N12.63trillion.
The report further revealed that despite a capital expenditure budget of N23.44trillion for the 2025 fiscal year, only N3.10trillion had been released by September, representing barely 13 per cent implementation performance.
Analysts say the development reflects the government’s growing inability to balance debt repayment with national development priorities, as key sectors continue to suffer from inadequate funding amid worsening inflation, unemployment and deteriorating infrastructure nationwide.
Details contained in the fiscal document showed that capital expenditure by Ministries, Departments and Agencies alongside other government entities stood at only N1.208trillion, while donor-funded and grant-backed projects accounted for N1.08trillion.
Government-owned enterprises recorded capital expenditure of N615.6billion, while capital supplementation stood at N200billion during the period under review.
Shockingly, the government recorded zero releases for multilateral and bilateral project-tied loans captured under capital expenditure between January and September 2025.
The report also indicated that total Federal Government expenditure rose to N24.66trillion within the first nine months of the year, while recurrent expenditure stood at N20.255trillion.
Personnel costs for Ministries, Departments and Agencies amounted to N5.09trillion, while pension and gratuity payments, including service-wide pensions, stood at N571.94billion.
Nigeria’s fiscal deficit also widened significantly, with the government recording an overall deficit of approximately N10.58trillion by the third quarter of 2025.
The deficit was largely financed through domestic borrowing estimated at N12.067trillion, further increasing concerns over the sustainability of Nigeria’s rising debt profile and the long-term implications on economic stability.
Economic experts have repeatedly warned that the country’s increasing dependence on borrowing, combined with weak revenue generation and poor capital budget implementation, could worsen poverty levels and slow economic growth.
Meanwhile, fresh data reviewed from the Debt Management Office showed that Nigeria paid a total of $848.7million to two World Bank agencies in debt servicing obligations in 2025 alone, despite still owing the institutions about $19.8billion by the end of the year.
The payments were made to the International Development Association and the International Bank for Reconstruction and Development, both arms of the World Bank Group.
The latest figures have sparked renewed concerns among economists and civil society groups, many of whom argue that the Federal Government is gradually operating an economy driven more by debt repayment than by meaningful investment in roads, healthcare, education, electricity and other critical infrastructure needed to improve citizens’ lives and stimulate national development.