Nigeria spent $954.1 million servicing its external debt in the first quarter of 2026, down by about 31 percent from $1.39 billion paid during the same period of 2025.
Data from the Debt Management Office showed that interest remained the largest component of the country’s foreign debt payments between January and March, accounting for $623.22 million.
Principal repayments amounted to $308.33 million, while fees and other charges accounted for another $22.50 million.
The lower overall payment was largely linked to a substantial reduction in principal obligations compared with the corresponding period of last year, when Nigeria paid $759.58 million towards principal alone.
This means the decline in total external debt servicing was driven more by the timing and size of repayments falling due than by a comparable reduction in the cost of carrying the country’s foreign debt.
Interest represented roughly 65 percent of the $954.1 million paid during the quarter, underscoring the continuing cost of Nigeria’s existing external obligations even as the total amount leaving government coffers declined.
Payments were spread across multilateral and bilateral creditors as well as commercial debt obligations, reflecting the government’s mix of concessional loans, bilateral financing and market-related borrowing.
Multilateral lenders received about $271.9 million during the quarter, substantially below the amount paid to the creditor group in the corresponding period of 2025.
Payments associated with bilateral obligations stood at approximately $180.3 million.
Market-related debt payments moved in the opposite direction, rising to about $501.8 million from $431.6 million a year earlier.
The contrasting movements show that while Nigeria faced lighter payment requirements on some official-sector loans during the quarter, servicing commercial and market-linked obligations continued to consume a significant amount of foreign currency.
The decline in external payments also comes against a considerably heavier cost of servicing federal government debt raised within Nigeria.
Separate DMO figures showed that domestic debt service reached N3.14 trillion in the first three months of 2026.
Of that amount, approximately N2.97 trillion went towards interest, while N169.68 billion represented principal repayments.
Treasury bills accounted for about N1 trillion of domestic interest costs, while Federal Government bonds consumed approximately N1.96 trillion. Another N4.24 billion was paid as interest on FGN Savings Bonds.
Domestic debt-service expenditure also accelerated during the quarter, rising from N741.82 billion in January to N967.67 billion in February before reaching N1.43 trillion in March.
The figures highlight a changing dimension of Nigeria’s debt challenge. While external servicing requirements eased during the first quarter, the government’s large stock of naira-denominated obligations continued to generate substantial interest costs.
Nigeria’s total public debt stood at about N159.35 trillion at the end of March 2026.
The trajectory of debt-service costs in subsequent quarters will depend on the government’s borrowing requirements, prevailing domestic interest rates, the maturity profile of existing obligations and conditions in international debt markets.
For fiscal authorities, lower external payments provide some relief to foreign-exchange requirements, but the high proportion of interest in both domestic and external servicing means debt costs will remain an important constraint on government finances.
