ABUJA, Nigeria (VOICE OF NAIJA)-Nigeria’s debt to the World Bank increased by $2.08bn within one year, reaching $19.89bn as of December 31, 2025, according to an analysis of external debt stock data released by the Debt Management Office.
This represents an 11.7 per cent rise from the $17.81bn recorded as of December 31, 2024.
The World Bank exposure consists of loans from the International Development Association and the International Bank for Reconstruction and Development.
While IDA provides concessional grants and loans to low-income countries, the IBRD offers financial products and policy advisory services mainly to middle-income and creditworthy developing economies.
Data from the DMO showed that Nigeria’s IDA debt climbed from $16.56bn in 2024 to $18.51bn in 2025, reflecting an increase of $1.94bn or 11.73 per cent.
Similarly, IBRD loans rose from $1.24bn to $1.38bn, an increase of $141.84m or 11.41 per cent.
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As a result, World Bank loans accounted for 38.36 per cent of Nigeria’s total external debt stock of $51.86bn at the end of 2025.
This was slightly lower than the 38.90 per cent recorded in 2024, when total external debt stood at $45.78bn.
Findings show that although the World Bank remains Nigeria’s largest external creditor, its share of total external debt declined marginally due to faster growth in other borrowing categories, particularly commercial and syndicated project loans.
Overall, Nigeria’s external debt increased by $6.08bn, or 13.27 per cent, rising from $45.78bn in 2024 to $51.86bn in 2025.
The World Bank accounted for about 34.3 per cent of this increase, making it a significant contributor to the growth in external debt during the period.
However, the biggest increase came from commercial and project-related obligations, largely driven by syndicated loans, while Eurobond debt also rose from $17.32bn to $18.55bn.
Multilateral debt grew from $22.32bn to $23.85bn, while bilateral debt increased from $6.09bn to $6.72bn.
The data suggest that Nigeria’s external borrowing remains heavily skewed towards multilateral lenders, with the World Bank accounting for more than four-fifths of multilateral debt in 2025.
This trend reflects the Federal Government’s continued dependence on concessional and semi-concessional financing, particularly from IDA, amid tight fiscal conditions, rising debt service obligations, and limited access to cheaper market funding.
Economists warn that while the expanding loan pipeline could support long-term development,
it may also intensify fiscal pressures if not supported by stronger domestic revenue generation and prudent spending.
Commenting on the development, Lagos-based economist Adewale Abimbola said loans from multilateral institutions such as the World Bank are largely concessional, with lower interest rates and longer repayment periods.
He stressed that the key issue is not borrowing itself, but how effectively the funds are structured and utilised. “If it’s concessionary and tied to viable projects with medium-term revenue prospects, I don’t think it’s a bad idea,” Abimbola explained. “Borrowing isn’t bad; what matters is utilisation.”
Abimbola added that the impact of such loans depends on whether they are channelled into projects that can drive sustainable growth, boost revenue, and improve public services over time.
A development economist and Chief Executive Officer of CSA Advisory, Dr Aliyu Ilias, has also raised concerns about Nigeria’s rising debt profile in light of fresh World Bank commitments.
While acknowledging that borrowing is not inherently harmful, he questioned the justification for taking on more debt at a time when government revenues are reportedly increasing.
According to him, the effects of the current borrowing trend are already visible in reduced public service delivery, particularly in capital expenditure, as debt servicing consumes a significant share of available revenue.