Business
Nigeria’s Debt Climbs To N50trn – Report
The Centre for the Promotion of Private Enterprise in Nigeria says the country’s debt is likely to hit N50tn within the shortest possible time.
Such debt include that of the Asset Management Corporation of Nigeria and borrowings from the Central Bank of Nigeria.
Disclosing this, Monday, during an event to present the 2022 first quarter economic review of CPPE in Lagos, the Chief Executive Officer, CPPE, Dr. Muda Yusuf, called for concessionary financing for the country, as opposed to commercial debts which are expensive.
“The rising debt profile of government raises serious sustainability concerns. The Debt Management Office had reported that total public debt was N39.56tn as at December 2021. About 11.3 per cent of this debt is owed by the states and FCT.
“However, when we take account of borrowings from the CBN and the stock of AMCON debt, the debt profile would be in excess of N50tn.
“Although government tends to argue that Nigeria does not have a debt problem, the country has a revenue challenge”, Yusuf said.
He explained that debt would typically become a problem if the revenue base was not strong enough to service it sustainably.
Government’s actual revenue could hardly cover recurrent budget, which implies that the entire capital budget and part of recurrent budget are being funded from borrowing which is not sustainable, he said.
According to Yusuf, “We cannot continue to increase borrowing on account of the relatively low debt/GDP ratio.
“We do not service debt with GDP, but with revenue. Close to 40 per cent of our GDP do not contribute appreciably to revenue”, he said.
He continued that government should have the political will to cut expenditure and undertake reforms that could scale down the size of government, reduce governance cost, and ease the fiscal burden on government and boost revenue.
“It is important to ensure that the debt is used strictly to fund capital projects, especially infrastructure projects, that would strengthen the productive capacity of the economy,” he said.
Yusuf, a former Director General of the Lagos Chamber of Commerce and Industry, said it was imperative for the country to operate as a true federation which it claims to be.
“The unitary character of the country is making it difficult to unlock the economic potentials of the subnational. It is perpetuating the culture of dependence on the federal government.
“It is necessary to scale down the size of government and cost of governance. We should note that fiscal sustainability is driven by both cost and revenue. Therefore, managing the major drivers of cost and revenue is imperative.”.
Credit to Nigeria’s private sector rose to N83.26 trillion in June 2026 from N81.04 trillion in May, signifying a positive balance of N2.22 trillion month-on-month.
Year-on-year, the figure represents a nine per cent increase compared with the N76.13 trillion recorded in June 2025. The latest figures come as the CBN continues to balance efforts to control inflation with the need to support economic growth and expand credit to businesses.
The CBN data shows that credit to Nigeria’s private sector increased by approximately 2.74 per cent month-on-month between May and June 2026. Also, the CBN data noted that credit to the government fell slightly to N40.03 trillion from N40.38 trillion. Other assets, net, dropped to N10.76 trillion from N12.63 trillion.
The credit surge signifies sustained growth in lending to businesses and other private-sector borrowers during the month. The rise in private sector credit was recorded alongside an increase in net domestic credit, despite declines in credit to government and other assets.
Further analysis of the report says that compared with June 2025, private sector credit rose by about N7.13 trillion yea-on-year but net domestic credit increased by approximately N1.87 trillion during the month.
The CBN’s relatively tight monetary policy stance notwithstanding, more banks still loaded funds to the private sector within the period. The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) held its 306th meeting on July 20 and 21.
The Committee reviewed recent developments in the global and domestic economies, assessed emerging risks to the outlook and considered their implications for monetary policy and retained all rates.
The Committee decided to retain the Monetary Policy Rate at 26.5 per cent; the Standing Facilities Corridor around the MPR at +50/-450 basis points and retain the Cash Reserve Requirement (CRR) for Deposit Money Banks at 45.00 per cent, Merchant Banks at 16.00 per cent, and non-TSA public sector deposits at 75.00 per cent.
The MPC decision means that credit extension in the private sector will likely continue to rise because of rising confidence in the sector and calls by stakeholders for banks to invest in the private scetor instead of government securities.
