Nigeria’s Debt Service Burden Could Reach 71.7% of Federal Revenue by 2030, DMO Projects +
The Debt Management Office says the outlook could worsen under economic shocks, even as public debt is projected to fall relative to GDP.
Nigeria's Debt Management Office says rising debt obligations could place increasing pressure on government finances despite a projected decline in the country's debt-to-GDP ratio.
November 10, 2026
ABUJA, Nigeria — Nigeria could spend 71.7% of its Federal Government revenue on debt servicing by 2030, according to projections by the country's Debt Management Office, raising concerns about the fiscal pressure facing Africa's largest economy.
The projection is contained in the DMO's 2024 Debt Sustainability Analysis, which examines Nigeria's ability to meet its existing and future debt obligations.
Under the DMO's baseline scenario, the debt service-to-revenue ratio is projected to fall from about 60.6% in 2024 to 44.9% in 2025 before rising again in the following years.
The ratio is projected to reach 51% in 2026, 57.1% in 2027, 57.4% in 2028 and 67.3% in 2029, before climbing to 71.7% in 2030.
Debt Costs Could Exceed DMO's Threshold
The projected 2030 figure would exceed the DMO's recommended debt service-to-revenue threshold of 50%.
A higher debt service-to-revenue ratio means a larger share of government income is required to meet debt obligations, potentially leaving less money available for infrastructure, education, healthcare and other public priorities.
The DMO said Nigeria's debt sustainability remained moderate but was vulnerable to weak revenue mobilisation, exchange-rate depreciation and global economic uncertainty.
Worse Outlook Under Economic Shock
The DMO also examined a shock scenario based on weaker economic conditions.
Under that scenario, the debt service-to-revenue ratio could rise to 97.3% by 2030, significantly increasing pressure on government finances.
The scenario assumes adverse developments, including a 30% exchange-rate depreciation, weaker economic performance and a decline in government revenue.
Debt-to-GDP Ratio Expected to Fall
Despite the projected increase in debt servicing pressure, the DMO expects Nigeria's public debt-to-GDP ratio to decline under its baseline scenario.
The ratio is projected to fall from approximately 53.7% in 2024 to 27.3% by 2030.
The contrasting projections highlight an important difference between the size of a country's debt relative to its economy and its ability to service that debt from government revenue.
In Nigeria's case, the DMO's projections suggest that even as debt becomes smaller relative to the overall economy, debt payments could still consume an increasingly large share of government income.
DMO Calls for Stronger Revenue Mobilisation
To reduce the risks, the DMO recommended measures aimed at increasing government revenue and improving spending efficiency.
These include expanding the tax base, improving tax compliance, using technology to strengthen revenue collection and making greater use of concessional financing where available.
The agency also highlighted the importance of maintaining fiscal and economic reforms while reducing vulnerabilities associated with borrowing and exchange-rate movements.
For Nigeria, the projections underline the importance of increasing government revenue alongside managing borrowing costs. The DMO's figures are projections rather than guaranteed outcomes, but they point to growing fiscal pressure if debt obligations continue to rise faster than government revenue.