The Federal Government has disputed the World Bank’s assessment of Nigeria’s debt burden, insisting that reports showing interest payments consuming 124 per cent of revenue in the first half of 2026 are misleading.
The Ministry of Finance said the figures cited in the World Bank’s October 2026 Nigeria Development Update did not fully reflect the country’s revenue position and included debt obligations serviced on behalf of state governments.
The ministry’s position was contained in a statement issued on Sunday and shared on X by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele.
The World Bank had raised concerns over Nigeria’s debt servicing-to-revenue ratio after reporting that interest payments reached ₦7.7 trillion in the first half of 2026, exceeding the Federal Government’s reported revenue for the period.
However, the ministry argued that comparing the interest payments with federal revenue alone overstated the ratio because the debt figure included obligations associated with other tiers of government, including external loans to states.
It also said the revenue figures excluded income earned by government agencies and enterprises that had not yet been remitted to the Treasury.
According to the ministry, the timing of statutory tax payments also affects revenue collection, with some taxes predominantly collected in the second half of the year.
FG Cites Revenue Growth
The ministry defended the government’s fiscal reforms, citing an increase in federal revenue between the first half of 2025 and the corresponding period in 2026.
It said revenue rose by 72 per cent, from ₦3.6 trillion to ₦6.2 trillion, while interest payments increased by 38 per cent, from ₦5.6 trillion to ₦7.7 trillion.
The ministry said the difference in growth rates demonstrated that revenue was increasing faster than interest costs.
It added that the interest-to-revenue ratio declined from 156 per cent in the first half of 2025 to 124 per cent in the first half of 2026, while the gap between interest payments and revenue narrowed from ₦2 trillion to ₦1.5 trillion.
The ministry also cited the 2025 figures, noting that the interest-to-revenue ratio stood at 156 per cent in the first half of that year, while the full-year debt-service-to-revenue ratio was below 60 per cent, compared with 97 per cent before the reforms.
It described the figures as evidence of progress under the current administration’s economic reforms.
World Bank’s Full-Year Projection
The ministry maintained that Nigeria’s debt sustainability should be assessed using full-year figures rather than data covering only six months.
It pointed to the World Bank’s projection that Nigeria’s total debt service, including both interest and principal repayments, would account for 46 per cent of revenue in 2026.
The government described the full-year projection as a more appropriate benchmark for assessing the country’s debt obligations.
It also said federal borrowing remained within the limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan.
According to the ministry, borrowing activities comply with the Fiscal Responsibility Act 2007 and the Debt Management Office (Establishment) Act 2003, with borrowing information published regularly by the Debt Management Office.
The ministry said it welcomed scrutiny of public finances but urged analysts and commentators to compare figures covering the same levels of government and periods when assessing Nigeria’s fiscal position.
The disagreement comes amid continued scrutiny of Nigeria’s debt obligations, government revenue and the impact of economic reforms on public finances.