Nigeria Spends 35% of 2024 Budget on Debt Service as Fiscal Deficit Hits ₦13.51 Trillion
The Federal Government of Nigeria spent a staggering ₦12.36 trillion servicing debts in 2024, representing 35.26% of the entire ₦35.05 trillion budget and a 52.71% overshoot of the ₦8.27 trillion initially allocated for debt payments. This revelation came from the Fourth Quarter 2024 Budget Implementation Report released by the Budget Office of the Federation, highlighting the growing fiscal pressure on government finances.
According to the report, Nigeria recorded a fiscal deficit of ₦13.51 trillion in 2024, ₦4.34 trillion (47.33%) higher than the projected deficit and above the ₦10.55 trillion shortfall recorded in 2023. The deficit was largely financed through a mix of multilateral and bilateral project loans (₦1.98 trillion), domestic borrowing (₦6.06 trillion), foreign borrowing (₦3.37 trillion), and ₦3.19 trillion in budget support.
Nigeria’s public debt-to-GDP ratio also rose sharply to 61.22% by the end of December 2024 — surpassing both the national threshold of 40% and the international benchmark of 56%, according to the report. Analysts warn that this trajectory may put additional strain on the country’s debt sustainability outlook unless revenue generation improves significantly.
On the revenue side, the government recorded ₦20.98 trillion in total inflows for 2024 — a 68.11% increase from ₦12.48 trillion in 2023 but still ₦4.89 trillion (18.92%) below budget estimates. Meanwhile, total federal expenditure reached ₦34.49 trillion, slightly below the ₦35.05 trillion budget projection but ₦11.45 trillion (49.7%) higher than the actual spending of 2023.
Non-debt recurrent spending amounted to ₦8.53 trillion, which was 24.29% lower than the ₦11.27 trillion budgeted but 20.48% higher than the ₦7.08 trillion spent in 2023. During the fourth quarter, non-debt recurrent expenditure stood at ₦3.03 trillion, while statutory transfers totaled ₦435.7 billion. The report also noted that ₦6.72 trillion was spent on recurrent debt in Q4 alone — a 37.7% rise above projections.
For capital projects, ₦5.81 trillion was released and cash-backed for ministries, departments, and agencies (MDAs) during the year. However, as of June 30, 2025, only ₦3.27 trillion (81.91%) had been utilized. The figures underscore Nigeria’s persistent challenge of balancing rising debt obligations with the need to fund critical infrastructure and social programs, amid calls for fiscal reforms to ensure sustainable economic growth.
source: The Guardian