FEDERAL GOVERNMENT DISPUTES WORLD BANK ASSESSMENT ON ₦7.7 TRILLION DEBT INTEREST PAYMENTS

Ministry of Finance defends fiscal reforms, arguing that revenue growth outpaced interest costs while insisting debt sustainability must be evaluated on a full-year basis

The Federal Government of Nigeria has challenged the World Bank's recent assessment regarding the country's debt servicing burden, dismissing claims that ₦7.7 trillion in interest payments recorded during the first half of 2026 indicates fiscal distress.  

In its latest Nigeria Development Update (NDU), the World Bank had raised concerns over Nigeria's fiscal health, reporting that interest payments surged to ₦7.7 trillion in the first half of 2026 from ₦5.6 trillion in the corresponding period of 2025, gulping approximately 124 per cent of reported federal revenue.  

Responding to the assessment, the Federal Ministry of Finance described the reported debt-service-to-revenue ratio as misleading, explaining that the figure included interest serviced on behalf of sub-national entities while excluding certain unremitted revenue channels.  

The Finance Ministry highlighted that federal revenue grew by 72 per cent to ₦6.2 trillion in the first half of 2026 from ₦3.6 trillion in H1 2025, compared to a 38 per cent increase in interest payments over the same period, demonstrating that revenue expansion is growing nearly twice as fast as interest obligations.  

Government officials further stressed that debt sustainability should be evaluated on a full-year trajectory rather than mid-year snapshots, pointing out that the World Bank's own projections place Nigeria's full-year 2026 debt-service-to-revenue ratio at 46 per cent, down significantly from pre-reform levels exceeding 90 per cent.  

Reaffirming its commitment to fiscal discipline, the Federal Government maintained that all public borrowings remain strictly within constitutional limits, asserting that ongoing tax administration and macroeconomic reforms are effectively reducing fiscal deficits over the long term.