The African Centre for Leadership, Strategy & Development (Centre LSD) organized the first in its series of policy dialogues for the year 2023 on the 29th       of March 2023. The policy dialogues are Centre LSD’s contribution towards drawing attention to topical issues in the country. It was themed “Nigerian Debt Profile: Issues, implications, Lessons and Solutions for the Next Administration.” The dialogue became imperative following the increasing debt profile of Nigeria and the Federal Government (FG), outcry that Nigeria’s debt sustainability has become threatened especially with growing shortfalls in revenue. This policy dialogue presented an opportunity for stakeholders to deliberate and have a shared understanding of the debt crisis in the country, make recommendations which the next Administration should consider in tackling the Nigerian Debt scenario. A total of twenty (20) on-site and forty-eight (48) online attendees drawn from government, Civil Society Organizations, Academia, and the Media participated in the dialogue session.


  • That the growing debt profile of Nigeria is not sustainable. According to the Nigerian Bureau of Statistics (NBS), Nigeria’s public debt stock which includes external and domestic debt rose from N42.84 trillion in the second quarter of 2022 to N44.06 trillion in the third quarter (September) of the same year. This debt figure comprises the debt stock of the Federal government, the 36 state governments and the Federal Capital Territory.
  • That despite the Country’s exit from the London and Paris clubs, the country has again been plunged into monumental debts by successive administration. Early this year the Debt Management Office (DMO) Nigeria, the government agency established to centrally coordinate the management of Nigeria’s debt stated that the next administration will inherit a public debt close to about N77 trillion by June 2023. This is especially if the N23 trillion loans from the Central Bank of Nigeria (CBN) are securitized. That already in less than 3 months in the fiscal year 2023, the DMO has raised N1.9 trillion for the Government via bonds instruments issuance, a sum that is more than 58% of the agency’s initial plans.
  • The lack of diversification of the Nigerian economy and the continued total dependence on oil remains the bane of government revenue generation.
  • Inability of the Government to integrate the Country’s very large informal sector into its tax administration framework/ culture has a huge effect on revenue accruing to the government.
  • At 97% debt service to revenue ratio, Nigerians are left with only 3% of revenue to drive its development priorities. This singular action denies the country the opportunities for infrastructural development and pushes it further to borrowing, thus exacerbating its debt.
  • The debt to revenue ratio of the country is in double digits (80.6% as at 2022), signifying that the country has gone beyond the world bank thresh hold of 22%. The debt service to revenue ratio which looks at the ability of a country’s revenue to cover its debt service obligations has been on the rise in recent years as Nigeria is faced with dwindling government revenue while its expenditures continue to increase.
  • That for Nigeria, the use of Debt to GDP indicator as a measure for debt sustainability is deceptive and inappropriate. This is due to the fact that our GDP does not translate to revenue because we have a weak productive base.
  • Government over the years is increasingly borrowing funds to finance recurrent expenditures, negating the principle of borrowing to fund capital projects that contribute to National development and can also be sources of revenue towards repaying such loans.


  • The Federal Government should consider putting in place a mechanism for debt auditing by the office of the Auditor General to ascertain the true state of the country’s debts burden and how they have been managed to inform the proper management of our debt portfolio.
  • Government authorities must take urgent steps to improve the country’s tax net, strengthen the tax systems, block leakages, ensure compliance of  appropriate remittances and sanction all forms of tax evasion.
  • Government should create the enabling environment to encourage private sector participation in the financing of projects through the public private partnership model.
  • There is a need to derive more revenue from our crude oil through local refining and other value chain activities. This will lift the burden of

Government payment of subsidies thus freeing more resources to impact other areas of National need.

  • Government should build trust between it and the citizens to engender voluntary tax compliance by providing appropriate and accurate information on the management of the economy.
  • There is need to strengthen execution capacities on revenue generation and on the implementation of the various policies designed to enhance the economy, such as the National Development Plan, Medium Term Debt Strategy, The Petroleum Industry Act, the 2007 Public Procurement Act, FISCAL Responsibility Act and ensure stability of the foreign exchange regime.
  • Subnational government should be strengthened to generate revenue through the formulation of initiatives to grow internally generated revenue while also implementing other strategic growth initiatives.
  • Government should use debt to revenue ratio as the appropriate and viable matrix for measuring debt sustainability.
  • The government should ensure that all borrowed funds are tied to development projects while consciously investing in the development of critical infrastructure.
  • The government should play down on deficit budgeting and clearly spell out a benchmark for debt sustainability while rethinking the use of Gross Domestic Product as the basis for debt sustainability.
  • The incoming administration should consider constituting a committee which shall take forward the conversation on debt relief with international creditors while also placing a moratorium on further borrowing.


Participants at the Centre LSD policy dialogue on Nigeria’s debt profile while agreeing that public debt is a crucial tool used by governments to finance public spending, decried the uncontrolled spiraling of the Country’s debt burden and called for urgent and concerted effort to arrest this burgeoning trend. Furthermore, they urged the incoming administration to muster the needed political will to embark on budgetary reform, fiscal prudence, and revenue innovation to enable it to chart a new route for the Country.

Signed by

1.Mrs. Victoria Udoh     _                       Centre LSD

2.Mr. Tunde Salman       _                      Good Governance Team

3.Mr. Tijah Bolton           _                       Policy Alert

4.Mr. Botti   Isaac           _                        Social Action

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