Nigeria Expends $2.01bn On Foreign Debt Repayment Between January, April – Report

Nigeria Foreign Debt Repayment – The Federal Government increased its expenditure on external debt servicing by 50 percent year-on-year, as reported by the latest international payment data from the Central Bank of Nigeria (CBN).

According to this data, Nigeria allocated approximately $2.01 billion for external debt repayment from January to April 2025, in contrast to the $1.33 billion spent during the same timeframe in 2024.

Debt servicing represented 77.1 percent of Nigeria’s total international payments over these four months, a significant increase from the 64.5 percent share noted in the corresponding period of 2024.

Overall, the country’s international payments, which include debt service, remittances, and letters of credit, reached $2.60 billion by April 2025, up from $2.07 billion in the same period of 2024.

Additionally, Nigeria’s foreign exchange reserves reportedly decreased by approximately $3 billion during this review period.

Month-on-month, Nigeria disbursed $540.67 million in January 2025, a slight decrease from the $560.52 million recorded in January 2024. In February, the amount was $276.73 million, nearly unchanged from the $283.22 million paid in February 2024.

However, debt service surged in March to $632.36 million, more than double the $276.17 million paid in the same month the previous year.

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The upward trend persisted in April, with an additional $557.79 million repaid, marking a 159 percent increase from the $215.20 million paid in April 2024.

In March and April alone, the country allocated nearly $1.2 billion for debt repayments, as indicated by the data. This development comes after the International Monetary Fund (IMF) confirmed that Nigeria has completely repaid the $3.4 billion in financial assistance received through the Rapid Financing Instrument, which was intended to mitigate the economic repercussions of the COVID-19 pandemic.

This loan represents one of the largest distributions under the Rapid Financing Instrument worldwide and was provided under more favorable conditions than typical IMF programs.

According to a statement from Christian Ebeke, the IMF Resident Representative for Nigeria, the repayment was finalized on April 30, 2025.

The IMF further stated, ‘As of April 30, 2025, Nigeria has fully repaid the financial support of approximately $3.4 billion that it requested and received in April 2020 from the International Monetary Fund under the Rapid Financing Instrument to assist in alleviating the effects of the COVID-19 pandemic and the significant decline in oil prices.’

The loan, which was disbursed in April 2020, was designed to help Nigeria cope with the drastic drop in oil prices, economic downturn, and fiscal challenges brought on by the pandemic.

Although the principal has been fully repaid, Nigeria will incur additional annual fees related to Special Drawing Rights charges of approximately $30 million over the coming years.

These charges are associated with the disparity between Nigeria’s SDR holdings, currently at SDR 3,164 million ($4.3 billion), and its total SDR allocation of SDR 4,027 million ($5.5 billion).

The fees are applied at the SDR interest rate, which is updated weekly, and will persist until Nigeria’s SDR holdings align with the total allocation amount, as noted by the IMF.