Economy
Domestic Debt Servicing Gulps N3.7tr in Three Years
By Dipo Olowookere
Data by the Debt Management Office (DMO) has revealed that the sum of N3.73 trillion has been used by Federal Government to service domestic debts since 2015.
In 2015, a total of N1.02 trillion was spent on domestic debt servicing, while in 2016, N1.23 trillion was used to service the local debts and N1.48 trillion was spent by government on debt servicing.
According to the data obtained by Business Post, in 2017, Federal Government spent N180.6 billion to service local debts in January and N187 billion was used for the same purpose in March.
In May 2017, it used N73.1 billion for debt servicing and N217.3 billion for same purpose in July.
In September, N171.4 billion was used to service local debts, N92.7 billion used in November and N52.2 billion in December.
A recent statement released by the DMO disclosed that the total debt profile of Nigeria as at December 31, 2017 was N21.73 trillion.
The composition of the debt stock showed that external debt was 26.64 percent of the portfolio, up from 20.04 percent in 2016, while domestic debt was 73.36 percent, down from 79.96 percent a year earlier.
Further analysis showed that the domestic debt for the Federal Government was N12.59 trillion, while that of the states and the Federal Capital Territory was N3.35 trillion.
The external debt of the Federal Government, states and the FCT was N5.79 trillion, putting the total public debt as of December 31, 2017 at N21.73 trillion.
The debt office noted that the total public debt as of December 31, 2017 represented 18.2 percent of Nigeria’s GDP for the year, showing that Nigeria’s debt had continued to be sustainable and was well within the threshold of 56 percent for countries in her peer group.
Federal Government has been spending considerable resources in recent times on the servicing of domestic debts, thereby raising questions of the sustainability of the country’s debt burden.
However, the Federal Government has insisted that the nation’s debt burden is sustainable since it is less than 20 percent of the country’s Gross Domestic Product although lesser revenues have made the payment of interest burdensome.
This has motivated the government to move towards foreign borrowing since such loans attract less interest payment.
Among the various instruments Federal Government used to borrow from the domestic debt market, the highest interest was paid on the FGN Bonds.
In 2017, for instance, Federal Government paid N982.66 billion on the FGN Bonds and a total of N445.13 billion was paid on Nigerian Treasury Bills; N22.99 billion on Treasury Bonds; while N25 billion of the principal was repaid.
In addition, an interest of N442 billion was paid on Savings Bonds.
According to the DMO, restructuring of the country’s debt mix has led to an increase in foreign debts in order to minimise the high interest rate on local debts.
“The key benefits of the restructuring of the portfolio are the reduction of the government’s debt service costs, lowering of interest rates in the domestic market and improved availability of credit facilities to the private sector.
“We repaid N198 billion Nigerian Treasury Bills in December 2017 with the proceeds of Eurobond issuances, and we have continued further implementation of the strategy in 2018, with the issuance of the S2.5 billion Eurobonds in February 2018, the proceeds of which are being used to repay maturing domestic debts, starting with N130 billion NTBs repaid on March 1, 2018,” the debt office said.
According to the DMO, the borrowings are for financing capital expenditure and stimulating the economy. The funds injected through the borrowings strongly supported the implementation of the Federal Government’s budget, which helped the country to exit recession in 2017.
Additional information from Economic Confidential
By Adedapo Adesanya
The Presidential Enabling Business Environment Council (PEBEC) has directed Ministries, Departments, and Agencies (MDAs) to suspend the introduction of new policies and regulatory changes to prevent disruptions to businesses.
The directive was issued in a statement by PEBEC director-general, Mrs Zahrah Mustapha-Audu, on Monday in Abuja, noting that the move is part of the Federal Government’s broader effort to improve regulatory quality, ensure policy consistency, and strengthen Nigeria’s ease of doing business environment.
The council emphasised that the suspension will remain in place until all MDAs fully comply with the Regulatory Impact Analysis (RIA) Framework, which governs evidence-based policymaking across government institutions.
The council said the directive is aimed at ensuring that all government policies are backed by verifiable data and do not negatively impact businesses or investors.
“It is imperative to emphasise that no new reform or policy will be permitted to proceed without being grounded in clear, verifiable evidence,” said Mrs Mustapha-Audu.
“The framework provides the structured mechanism through which such evidence-based decisions can be rigorously developed, assessed, and validated.
“This directive is necessary to prevent policy shocks that may adversely affect businesses, investors, and citizens, as well as to eliminate policy inconsistencies and frequent reversals.”
She added that the government remains committed to working collaboratively with regulators and does not intend to embarrass any institution.
The Regulatory Impact Analysis (RIA) Framework, introduced in January 2025, is designed to improve transparency and ensure that policies undergo proper evaluation before implementation.
All MDAs are required to align new policies and amendments with the RIA framework before approval and rollout.
The framework has been circulated by the Office of the Secretary to the Government of the Federation (SGF) and is available on the PEBEC website.
MDAs are encouraged to seek technical support from the PEBEC Secretariat to ensure proper implementation.
Exceptions to the directive will only be granted in cases of urgent national interest, subject to appropriate approvals.
PEBEC noted that the framework will help institutionalise evidence-based policymaking, enhance transparency, and improve stakeholder confidence in government decisions.
By Aduragbemi Omiyale
Subscription for the Federal Government of Nigeria (FGN) savings bonds for April 2026 has opened, a circular from the Debt Management Office (DMO) on Tuesday, April 7, 2026, confirmed.
The debt office is selling the retail debt instrument for this month in two tenors of two years and three years.
Offer for the savings bonds opened today and will close on Friday, April 10, 2026, a part of the disclosure stated.
The 2-year FGN savings bond due April 15, 2028, is being sold at a coupon rate of 13.082 per cent per annum, while the 3-year FGN savings bond due April 15, 2029, is being sold at a coupon rate of 14.082 per cent per annum.
The interests are paid every quarter, and the bullet repayment to subscribers on the maturity date.
The bonds are sold at N1,000 per unit, subject to a minimum subscription of N5,000 and in multiples of N1,000 thereafter, subject to a maximum subscription of N50 million.
Interested investors are required to reach out to the stockbroking firms appointed as distribution agents by the DMO via the agency’s website.
An FGN savings bond qualifies as securities in which trustees can invest under the Trustee Investment Act. It also qualifies as government securities within the meaning of the Company Income Tax Act (CITA) and the Personal Income Tax Act (PITA) for tax exemption for pension funds, amongst other investors, meaning it is tax-free.
It can be used as a liquid asset for liquidity ratio calculation for banks, and is listed on the Nigerian Exchange (NGX) Limited to allow for easy exit (liquidation) before maturity by selling at the secondary market.
By Adedapo Adesanya
Oil prices climbed on Monday’s short trade as the United States and Iran threatened more attacks, as the two countries are engaging in indirect talks that could lead to the de-escalation of hostilities.
Brent crude futures settled at $109.77 a barrel after chalking up 74 cents or 0.68 per cent, while the US West Texas Intermediate (WTI) crude futures traded at $112.40 after growing by 87 cents or 0.78 per cent.
The US and Iran received a framework from Pakistan to end hostilities, but this was rejected by Iran, especially the idea of immediately reopening the strait after President Donald Trump threatened to rain “hell” on the nation if it did not make a deal by the end of Tuesday.
Iran said it had formulated its positions and demands in response to recent ceasefire proposals conveyed via intermediaries.
The US is eyeing an agreement to open the crucial Strait of Hormuz, the shipping artery used by one-fifth of the world’s oil and gas supply, but the strait, which carries oil and petroleum products from Iraq, Saudi Arabia, Qatar, Kuwait and the United Arab Emirates, remains largely closed due to Iranian attacks on shipping after the U.S.-Israel attacks began on February 28.
Some vessels, however, including an Omani-operated tanker, a French-owned container ship and a Japanese-owned gas carrier, have passed through the strait since Thursday.
Meanwhile, major oil consumers, particularly in Asia, are conserving barrels or cutting consumption in response to the closure of the strait.
The Middle East supply disruptions have led refiners to seek alternative sources for crude, particularly for physical cargoes in the US and Britain’s North Sea.
Indian refiners have also postponed maintenance shutdowns of their units to meet local fuel demand.
On Sunday, the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) agreed to a modest rise of 206,000 barrels per day for May. However, this will only appear on paper as the disruption is limiting the ability of the top producers to add the needed output.
OPEC’s combined oil output losses for March were estimated at 7.2 million barrels daily. The biggest production cuts were made by Kuwait, Iraq, the United Arab Emirates, and Saudi Arabia, for a total OPEC output of 21.57 million barrels daily for March. This is the lowest OPEC production rate since June 2020.
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