Debt Burden: Nigeria Spends $817.4 Million in Two Months as CBN Report Shows 3.12% Decline
Written by Okafor Joseph, Editor for SpringsNewsNG Media Limited
March 13, 2025
In the first two months of 2025, Nigeria allocated $817.4 million (approximately N1.26 trillion) towards debt servicing, reflecting a 3.12 percent decline compared to the $843.73 million spent in the same period in 2024. This information is derived from the Central Bank of Nigeria’s (CBN) International Payments Report.
A month-by-month analysis shows that the government spent $540.7 million in January 2025 and $276.7 million in February 2025 on debt servicing. In contrast, the country had spent a total of $3.81 billion (around N5.9 trillion) on debt service payments throughout 2024.
Budgetary Allocation for Debt Servicing
The Federal Government, in its 2025 budget, allocated N16.3 trillion for debt servicing, marking a 95 percent increase from the N8.25 trillion budgeted in 2024. The 2025 budget, labeled the “Budget of Restoration” by President Bola Tinubu, aims to stabilize the economy and stimulate growth. The total proposed spending stands at N54.99 trillion, a 56.89 percent rise from the N35.05 trillion budgeted in 2024, which included a supplementary N6.2 trillion.
Decline in Foreign Trade through Letters of Credit
In addition to debt servicing, the CBN report highlighted a 0.55 percent Year-on-Year (YoY) decline in foreign trade through Letters of Credit (LC) payments. The payments fell to $160 million in the first two months of 2025, down from $160.9 million during the same period in 2024. LC payments are a vital indicator of a country’s creditworthiness and can also reflect changes in the volume of import trades.
The figures from the CBN underscore the government’s effort to manage its debt obligations while balancing economic growth and international trade dynamics.
