The report showed that Nigeria’s external debt increased from $45.78 billion to $51.80 billion during the period, reflecting continued reliance on foreign financing to support fiscal operations and infrastructure funding.
Analysts at Coronation Merchant Bank attributed the increase largely to a $2.35 billion dual-tranche Eurobond issuance completed in November 2025 alongside additional multilateral and bilateral loan drawdowns.
The bank noted that the growth in external obligations occurred despite the appreciation of the naira into the N1,400 range in the third quarter of 2025, which helped reduce the naira valuation impact of foreign debt.
According to the report, the increase signals that Nigeria’s debt expansion is no longer being driven mainly by exchange rate depreciation but by structural borrowing pressure and sustained deficit financing needs.
“External debt alone grew by $6.07 billion in dollar terms,” the report stated, adding that the trend reflects Nigeria’s continued dependence on foreign capital markets and international lenders.
Nigeria’s total public debt stock stood at N159.28 trillion ($110.97 billion) as of Q4 2025 with external obligations accounting for N74.43 trillion or 46.73 percent of the total debt profile.
The report said Nigeria’s external debt portfolio consists of multilateral loans from institutions such as the World Bank, African Development Bank and the International Monetary Fund, bilateral loans from countries including China and France and commercial borrowings through Eurobonds.
Eurobonds alone accounted for about $18.55 billion or approximately 35.77 percent of Nigeria’s total external debt stock as of 2024.
The report further revealed that the National Assembly approved an additional $6 billion external borrowing package in March 2026.
The package includes a $5 billion Total Return Swap facility with First Abu Dhabi Bank and a $1 billion UK Export Finance-backed port facility.
Coronation Merchant Bank said the approval indicates that Nigeria’s reliance on foreign borrowing is expected to continue into 2026 as the government seeks to bridge fiscal gaps and finance capital projects.
The bank noted that improved investor sentiment and reform optimism have recently supported Nigeria’s Eurobond market performance.
However, it warned that global market volatility, policy reversals or weaker oil prices could significantly raise the cost of future external borrowing.
Analysts also cautioned that Nigeria’s exposure to foreign currency debt leaves the country vulnerable to exchange rate fluctuations because any sustained depreciation of the naira could sharply increase the local currency value of external obligations.
