Raphael Johnson
The latest international payments data published by the Central Bank of Nigeria on its website on Wednesday indicated that Nigeria spent about $2.01bn on external debt servicing between January and April 2025, marking a 50 percent increase compared to the $1.33bn recorded during the same period in 2024.
The data showed that debt servicing alone accounted for 77.1 per cent of Nigeria’s total international payments within the four months, a sharp rise from the 64.5 per cent share recorded in the same period of 2024.
In total, the country’s international payments, comprising debt service, remittances, and letters of credit, stood at $2.60bn as of April 2025, up from $2.07bn recorded in the corresponding period of 2024.
The figures highlight the increasing burden of external debt on Nigeria’s foreign exchange reserves, which reportedly fell by about $3bn during the review period.
An analysis of the monthly trend shows that Nigeria paid $540.67m in January 2025, slightly below the $560.52m recorded in January 2024. In February, the figure stood at $276.73m, almost unchanged from the $283.22m paid in February 2024.
However, in March, debt service spiked to $632.36m, more than double the $276.17m paid in the same month last year. The trend continued in April with another $557.79m disbursed, representing a 159 per cent increase from the $215.20m paid in April 2024.
Within just two months (March and April), Nigeria spent nearly $1.2bn on debt repayments alone, pointing to a heavy schedule of maturing loans during the period. The sharp rise in obligations suggests the settlement of large commercial or bilateral debts within those two months.
It was also observed that the two-month period coincided with the clearance of an external debt obtained from the International Monetary Fund. The IMF earlier confirmed that Nigeria has fully repaid the $3.4bn financial support it received under the Rapid Financing Instrument to cushion the economic impacts of the COVID-19 pandemic.
In a statement sent to journalists on behalf of Mr Christian Ebeke, the IMF Resident Representative for Nigeria, the Fund said the repayment was completed on April 30, 2025. The loan, disbursed in April 2020, was aimed at helping Nigeria address a sharp fall in oil prices, economic contraction, and fiscal pressures caused by the pandemic.
“As of April 30, 2025, Nigeria has fully repaid the financial support of about $3.4bn it requested and received in April 2020 from the International Monetary Fund under the Rapid Financing Instrument to help alleviate the impact of the COVID-19 pandemic and the sharp fall in oil prices,” the IMF stated.
However, despite the full settlement of the principal, Nigeria will continue to honour additional annual payments related to Special Drawing Rights charges. The Fund noted that the country is expected to make annual payments of about $30m in SDR-related charges over the next few years.
According to the IMF, the charges are tied to the difference between Nigeria’s SDR holdings, which currently stand at SDR 3,164m ($4.3bn), and its cumulative SDR allocation of SDR 4,027m ($5.5bn). The charges are levied at the SDR interest rate, which is updated weekly, and will continue until Nigeria’s SDR holdings match the cumulative allocation amount.
Nigeria’s $3.4bn loan from the IMF was one of the largest disbursements under the Rapid Financing Instrument globally and came with relatively favourable terms compared to traditional IMF programmes.
