Researchers at the Centre for the Study of Economies of Africa (CSEA), a leading economic think-tank with primary focus on developments in Sub-Saharan Africa’s (SSA’s) economies, has advised the Federal Government of Nigeria’s fiscal authorities to prioritize fiscal policy that would enhance non-oil revenue mobilisation moderate the nation’s rising debt profile.
The experts, in the firm’s just published ‘Nigeria Economic Update Issue 15’ edition circulated to our correspondent, maintained that fiscal policy prioritization on non-oil revenue would reduce the government’s dependence on borrowing, improve expenditure efficiency to contain recurrent spending pressures, and gradually increase reliance on concessional external financing to moderate debt servicing costs.
They hinged the firm’s stance on the recently published debt stock data published by the nation’s Debt Management Office (DMO), which reflected a rising trend in external and external borrowings by the federal and subnational governments over the past years.
For instance, the DMO recently reported that Nigeria’s total public debt stood at N159.28 trillion in December 2025, up from N153.29 trillion in September 2025, representing a quarterly increase of N5.99 trillion (3.90%).
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The data showed that when analyzed on a year-on-year (y-o-y) comparison, the total public debt rose by N14.61 trillion at the end of December last year from N144.67 trillion in December 2024, indicating a 10.10 percent rise over the period.
Similarly, a breakdown of the debt stock in December 2025 reflected that external debt amounted to N74.43 trillion, accounting for 46.73 percent of total public debt. Of this amount, the Federal Government owed N66.27 trillion, while the states and the Federal Capital Territory (FCT) accounted for N8.16 trillion.
When analyzed on foreign and domestic ratio, domestic debt was higher at N84.85 trillion, representing 53.27 percent of the total, with the Federal Government responsible for N80.49 trillion and the states and the FCT for N4.36 trillion.
According to the CSEA experts, this structure highlights the continued dominance of domestic borrowing and the significantly larger debt burden borne by the Federal Government relative to subnational governments.
In addition, they noted that it also demonstrated a sustained reliance on borrowing to meet financing needs, with domestic instruments remaining the primary source of funding.
To tackle the worrisome fiscal trend, the analysts canvassed: “To manage rising debt exposure, fiscal policy should prioritise enhanced non-oil revenue mobilisation to reduce dependence on borrowing, improve expenditure efficiency to contain recurrent spending pressures, and gradually increase reliance on concessional external financing to moderate debt servicing costs.”
