By Our Correspondent
Nigeria’s public debt has continued to grow under President Bola Ahmed Tinubu, drawing attention from the World Bank and sparking conversations about the country’s economic direction.
According to recent assessments, Nigeria’s total debt stock is increasing due to ongoing borrowing aimed at funding infrastructure, social programs, and economic reforms. While this rise has raised concerns, experts emphasize that the situation is more nuanced than the headline suggests.
A major issue highlighted is not just the size of the debt, but the cost of servicing it, as a significant portion of government revenue is currently used to repay loans. This puts pressure on public finances and limits spending in other critical areas.
However, there are important positives in the broader economic picture. The Tinubu administration has introduced reforms such as fuel subsidy removal and foreign exchange adjustments, which are beginning to improve fiscal stability. Additionally, Nigeria continues to rely largely on concessional loans, typically lower-interest financing from institutions like the World Bank, which are considered less risky than commercial borrowing.
Importantly, Nigeria’s debt-to-GDP ratio remains relatively moderate, meaning the country is not among the most heavily indebted nations globally. This suggests that while debt is rising, it is still within a manageable range provided economic growth and revenue generation improve.
The World Bank’s position is not a warning of crisis, but rather a call for careful debt management and stronger revenue mobilization. The long-term outlook will depend on how effectively current reforms translate into sustained economic growth.
Nigeria’s debt is increasing, but with the right policies and continued reforms, it remains a challenge that can be managed, not a crisis yet.
