Nigeria’s private sector foreign debt rise 179.6% to $54.5bn — World Bank

By Babajide Komolafe The World Bank said that the foreign debt of Nigerian companies rose by 179.6 per cent in seven years to $54.48 billion in 2025 from $19.49 billion in 2018. This implies that Nigerian businesses now owe foreign lenders almost three times what they owed in 2018. The World Bank disclosed this in its International Debt Report 2026 which stated that Nigeria’s private sector nonguaranteed external debt stood at $54.476 billion as of December 2025.

The World Bank explained that the total external debt of a country is the sum of public and publicly guaranteed debt, private nonguaranteed debt, and short-term debt. According to the World Bank, private sector nonguaranteed external debt refers to money borrowed by private companies from foreign banks, investors and other lenders without the government or any public institution guaranteeing repayment.

“Private nonguaranteed debt comprises long-term external obligations of private debtors that are not guaranteed by a public entity. “Public and publicly guaranteed external debt comprises long-term external obligations (maturities of over one year) of all public debtors, including debt held by the central government and by state-owned enterprises. Short-term debt is defined as debt with an original maturity of one year or less ,” the report said.

The 179.6 per cent growth in Nigeria’s private sector in the seven years was faster than the increase in government-backed external debt, which rose by 155.5 per cent from $24.422 billion in 2018 to $62.4 billion in 2025. The World Bank report showed that private companies’ foreign debt is becoming an increasingly important part of Nigeria’s external debt burden.

In 2018, private sector nonguaranteed debt was equivalent to about 79.8 per cent of public and publicly guaranteed external debt. By 2025, it had increased to 87.3 per cent. Meanwhile, Nigeria’s total external debt, covering government borrowing, private companies’ foreign loans and short-term obligations, increased from $46.238 billion in 2018 to $145.015 billion in 2025.

The report also highlighted the high cost of borrowing from private foreign lenders. According to the World Bank, new loans obtained by Nigeria from private foreign creditors in 2025 attracted an average interest rate of 9.6 per cent, compared with 1.9 per cent for loans from official creditors such as governments and multilateral institutions. Private lenders also offered an average repayment period of 12 years, compared with 25 years for official creditors.