Service payments reflect the growing pressure on Nigeria’s fiscal balance amid ongoing economic challenges. According to the World Bank’s latest International Debt Report, developing nations spent a record $1.4 trillion on foreign debt servicing in 2023, largely due to rising interest rates, the highest in two decades. Interest payments alone reached $406 billion, a nearly 30% increase from the previous year, straining funding for essential sectors like health, education, and environmental programs.
The report highlights that the most vulnerable economies, especially those eligible for loans from the World Bank’s International Development Association, faced the worst financial strain.
In a recent statement, the Federal Government reiterated its commitment to reducing reliance on external debt financing while working toward economic independence through strategic partnerships with the World Bank. Finance Minister and Coordinating Minister of the Economy, Mr. Wale Edun, shared this during a meeting with World Bank Executive Director, Dr. Zainab Shamsuna Ahmed. Edun emphasized Nigeria’s shift toward private sector-led growth.
The statement noted, “Edun emphasized that President Tinubu remains committed to strengthening Nigeria’s economic foundation, reducing dependence on external borrowing, and ensuring sustainable, private-sector-driven development.” Edun also acknowledged the crucial role of the World Bank in Nigeria’s development while stressing the government’s focus on creating a business-friendly environment to attract long-term investments.
