The Federal Government of Nigeria has surpassed its 2025 borrowing target by a staggering 55.6 percent, raising concerns about the nation’s growing debt profile and fiscal discipline. According to fresh data from the Debt Management Office (DMO) and the Budget Office, the government borrowed a total of ₦17.36 trillion between January and October 2025, far above its projected ₦10.9 trillion borrowing plan for the same period. The 2025 Appropriation Act had set the full-year borrowing ceiling at ₦13.08 trillion, but the current figure shows a significant deviation from the fiscal plan.
A detailed breakdown of the figures indicates that ₦15.8 trillion of the amount was sourced from the domestic market through bonds and treasury bills, while ₦1.56 trillion came from external lenders. This borrowing surge reflects the government’s attempt to bridge shortfalls in revenue generation, particularly amid lower-than-expected oil income and weak non-oil tax performance. Analysts note that the borrowing trend could rise further as the government plans to raise an additional $2.35 billion (about ₦3.38 trillion) through a Eurobond issuance before the end of the year.
Fiscal experts have warned that if this trajectory continues, total government borrowing for 2025 could reach nearly ₦23 trillion, almost 80 percent higher than what was initially budgeted. Such an outcome would push Nigeria deeper into debt and could trigger an increase in debt servicing obligations, which already consume a large portion of government revenues. In the 2025 budget, debt service was projected at ₦10.6 trillion, representing over 60 percent of total expected revenues.
The overshoot, according to economists, underscores Nigeria’s growing reliance on debt rather than sustainable revenue sources to finance public spending. Weak oil production, currently averaging between 1.6 and 1.7 million barrels per day below the budget benchmark of 2.06 million barrels per day has further constrained the government’s income. Meanwhile, declining global oil prices, now hovering around $65 per barrel compared to the budgeted $75, have also reduced projected receipts from crude exports.
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This fiscal imbalance has forced the government to turn increasingly to domestic borrowing, crowding out private sector access to credit. Financial analysts say that the continuous issuance of government securities at high yields makes it more attractive for banks and investors to lend to the government rather than to businesses. This trend, they warn, could stifle economic growth, raise interest rates, and limit job creation opportunities in the private sector.
Beyond the issue of crowding out, experts also caution that rising borrowing will heighten the country’s debt-service burden. With interest rates trending upward and the naira still under pressure, debt repayment costs could surge further. Already, Nigeria’s debt-to-GDP ratio has climbed to around 46 percent, while its debt-service-to-revenue ratio remains one of the highest among emerging economies. Analysts stress that without a significant boost in revenue, Nigeria could face a debt sustainability crisis in the near future.
The 2025 budget, which set total expenditure at ₦54.99 trillion and projected total revenue at ₦41.91 trillion, had already built in a deficit of ₦13.08 trillion to be financed largely through borrowings. However, the scale of borrowing recorded within just ten months of the year shows that the deficit may have expanded beyond control. Economic observers are calling for stronger fiscal discipline, better monitoring of capital spending, and a review of recurrent expenditure to avoid further slippage.
On the policy side, experts believe that government must now prioritise revenue reforms to reduce dependence on borrowing. Suggested measures include broadening the tax base, improving compliance, and boosting non-oil revenue sources such as manufacturing, ICT, and agriculture. They also recommend that borrowed funds be channelled strictly into productive sectors and infrastructure projects that can generate long-term economic returns rather than being used to fund recurrent expenditure.
For ordinary Nigerians, the effects of excessive borrowing are already being felt in rising inflation, higher interest rates, and limited funding for public services. As more of the national budget goes into debt repayment, less is available for education, healthcare, and infrastructure development. The continuous depreciation of the naira and mounting inflationary pressures also mean that the cost of living will likely rise further, deepening hardship for millions.
In summary, while borrowing remains an important tool for development financing, the pace at which Nigeria is accumulating debt in 2025 has raised legitimate concerns. Exceeding the borrowing target by more than half not only signals fiscal strain but also poses long-term risks to economic stability. Stakeholders insist that unless the government adopts stronger revenue strategies and spending discipline, Nigeria may soon find itself caught in a debt trap, paying more to service old loans than it invests in its people and future growth.
