NIGERIA’S external debt rose by $2.62 billion in three months to $54.52 billion at the end of June 2026, as a $1.5 billion transaction with First Abu Dhabi Bank and fresh multilateral loans increased the country’s external obligations.
The Central Bank of Nigeria (CBN) disclosed this in its second-quarter (Q2) 2026 economic report, putting external debt at 16.67 percent of gross domestic product, up from $51.90 billion at the end of March.
The increase came as foreign portfolio inflows into Nigeria climbed to $7.09 billion from $6.0 billion in the first quarter (Q1), driven mainly by foreign investors’ increased purchases of long-term government debt securities.
Multilateral and commercial debt dominate
Multilateral loans accounted for the largest share of Nigeria’s external debt at the end of June, amounting to $24.76 billion, or 45.42 percent of the total.
These obligations were mainly to the World Bank Group and the African Development Bank Group. Commercial borrowings, including Eurobonds and syndicated loans, stood at $23.26 billion, representing 42.47 percent, while bilateral loans amounted to $6.61 billion, or 12.12 percent.
The increase in external debt was driven by a $1.50 billion Total Return Swap with First Abu Dhabi Bank and $900 million in multilateral loans.
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Debt service remains a major obligation
Nigeria spent $870 million servicing its external debt in Q2, down from $950 million in Q1. Interest payments accounted for $490 million, representing 56.47 percent of total debt service, while principal repayments stood at $340 million, or 39.02 percent. Other charges accounted for the balance.
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Multilateral creditors received $400 million, representing 46.42 percent of total payments. The International Development Association (IDA) accounted for $200 million of this amount.
Payments on commercial debt instruments stood at $330 million, including $220 million in Eurobond interest, while bilateral creditors received $140 million.
Although total debt service declined by $80 million quarter-on-quarter, interest payments remained the largest component of the amount paid.
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Foreign portfolio inflows strengthen
The CBN report also showed that portfolio investment inflows rose to $7.09 billion in Q2 from $6.03 billion in Q1, reflecting increased investment in long-term government debt securities.
Other investment liabilities increased to $2.75 billion from $1.36 billion, following higher loan drawdowns by the government and other sectors, alongside increased currency and deposit liabilities of deposit-taking corporations.
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Direct investment liabilities rose to $1.15 billion from $1.03 billion, driven by higher reinvested earnings.
Overall, Nigeria’s net incurrence of financial liabilities increased to $10.84 billion from $8.36 billion in the preceding quarter.
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The Debt Management Office (DMO) said that Nigeria’s total public debt rose to N166.79 trillion as of June 30, 2026.The figure represented a 9.4 percent or N14.39 trillion increase from the N152.4 trillion recorded at the end of June 2025.
