The Federal Government has challenged the World Bank’s report that interest payments on Nigeria’s debt consumed 124 per cent of its revenue in the first half of 2026, describing the figure as misleading and arguing that it does not present a complete picture of the country’s fiscal position.
The Federal Ministry of Finance, in a statement issued on Sunday, October 18, said the calculation contained inconsistencies because it compared interest payments covering multiple tiers of government with federal revenue alone.
According to the ministry, the World Bank’s October 2026 Nigeria Development Update reported that the Federal Government spent ₦7.7 trillion on interest payments during the first six months of the year, against revenue of ₦6.2 trillion.
However, the ministry argued that the interest payment figure included debt obligations settled by the Federal Government on behalf of other tiers of government, including external loans owed by state governments. It also said the revenue figure excluded income earned by government agencies and enterprises but not yet remitted to the Treasury.
The ministry maintained that comparing debt obligations and revenue across different levels of government could exaggerate the actual burden. It also argued that a six-month assessment does not adequately reflect the government’s overall debt sustainability, noting that statutory tax payments typically result in higher revenue collections during the second half of the year.
To support its position, the ministry said federal revenue increased by 72 per cent, from ₦3.6 trillion in the first half of 2025 to ₦6.2 trillion in the corresponding period of 2026. Interest payments, meanwhile, rose by 38 per cent, from ₦5.6 trillion to ₦7.7 trillion.
It added that the interest-to-revenue ratio declined from 156 per cent in the first half of 2025 to 124 per cent in the first half of 2026, representing a reduction of 32 percentage points. The gap between interest payments and revenue also narrowed from ₦2 trillion to ₦1.5 trillion, which the ministry described as evidence of progress under the administration’s economic reforms.
The ministry further cited the World Bank’s projection that Nigeria’s full-year debt service, covering both principal repayments and interest, would amount to 46 per cent of revenue in 2026. It described the projection as a more appropriate benchmark for assessing the country’s debt position than a half-year interest-to-revenue ratio.
On borrowing, the ministry insisted that all Federal Government loans fall within the limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan. It added that borrowing activities comply with the Fiscal Responsibility Act 2007 and the Debt Management Office (Establishment) Act 2003, with details published regularly by the Debt Management Office.
While welcoming scrutiny of Nigeria’s public finances, the ministry urged analysts and commentators to interpret fiscal figures in their proper context and ensure that comparisons are made using consistent revenue and debt measurements.
