The Federal Government has challenged World Bank’s assessment of Nigeria’s debt position, describing as misleading reports that interest payments reached N7.7 trillion in the first half of 2026, exceeding government revenue and raising concerns about debt sustainability.
The Federal Ministry of Finance said the assessment, which put interest payments at 124 per cent of Federal Government revenue between January and June 2026, relied on incomplete revenue figures and failed to account for debt obligations serviced on behalf of state governments.
The ministry stated its position in a statement issued on Sunday and shared by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele.
According to the ministry, the calculation compared debt obligations covering multiple tiers of government with revenue attributed solely to the Federal Government, thereby overstating the interest-to-revenue ratio.
It explained that some of the interest payments included external loans serviced by the Federal Government on behalf of state governments, arguing that debt and revenue figures must cover the same level of government for a meaningful comparison.
The ministry also said the reported revenue figure excluded income earned by government agencies and enterprises that had not yet been remitted to the Treasury.
It added that statutory payment schedules meant some taxes were collected predominantly in the second half of the year, making first-half figures an incomplete basis for assessing annual debt obligations.
The World Bank’s October 2026 Nigeria Development Update put Federal Government revenue at N6.2 trillion and interest payments at N7.7 trillion during the first half of the year. The figures indicated that interest payments exceeded revenue by N1.5 trillion.
However, the Finance Ministry maintained that Nigeria’s fiscal position had improved, with revenue growing faster than interest payments.
It said Federal Government revenue increased by 72 per cent, from N3.6 trillion in the first half of 2025 to N6.2 trillion in the corresponding period of 2026.
Over the same period, interest payments rose by 38 per cent, from N5.6 trillion to N7.7 trillion.
According to the ministry, the interest-to-revenue ratio consequently declined from 156 per cent in the first half of 2025 to approximately 124 per cent in the first half of 2026, while the gap between interest payments and revenue narrowed from N2 trillion to N1.5 trillion.
The ministry described the development as evidence that the administration’s economic reforms were producing results rather than indicating fiscal distress.
It also argued that debt sustainability should be assessed using full-year figures rather than a six-month snapshot.
Citing the World Bank’s projections, the ministry said Nigeria’s full-year 2026 debt-service-to-revenue ratio, covering both interest and principal repayments, was projected at 46 per cent.
The government further defended its borrowing programme, insisting that all loans obtained by the current administration were within the limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan.
It added that federal borrowing complied with the Fiscal Responsibility Act of 2007 and the Debt Management Office (Establishment) Act of 2003, while details of the country’s debt obligations were regularly published by the Debt Management Office.
Despite disputing the World Bank’s assessment, the ministry did not provide revised revenue and interest-payment figures or an alternative ratio to substantiate its position.