The Federal Government has rejected claims that interest payments reached 124% of revenue in the first half of 2026, calling the conclusion misleading and saying the full-year position was far lower.
In a statement issued in Abuja on Sunday, the Federal Ministry of Finance said it had noted recent analysis and public commentary which, citing the World Bank’s October 2026 Nigeria Development Update, made the claim. It offered three reasons why the conclusion cannot stand.
First, the Ministry said the figure compares mismatched numbers against an incomplete revenue base.
According to the statement, the interest figure includes debt the Federal Government services on behalf of other tiers of government, including external loans to states. Measuring this against federal revenue alone overstates the ratio, which is only meaningful when debt and revenue cover the same level of government.
The Ministry added that the reported revenue is incomplete because it excludes independent revenue already earned by government agencies and enterprises but not yet remitted to the Treasury.
It also noted that more revenue is typically earned in the second half of the year than in the first because of the statutory timing of certain tax payments.
This, it said, explains why the ratio stood at 156% in the first half of 2025, while the full-year 2025 debt service to revenue ratio was below 60%, down from 97% before the reforms.
“This is a clear sign of the progress delivered by the current administration’s reforms,” the statement said.
Second, the Ministry argued that even on the same calculation, the position has improved significantly. Between the first half of 2025 and the first half of 2026, federal revenue rose by 72%, from ₦3.6 trillion to ₦6.2 trillion, while interest payments rose by a much slower 38%, from ₦5.6 trillion to ₦7.7 trillion. Revenue is therefore growing almost twice as fast as interest costs.
As a result, the interest to revenue ratio fell by 32 percentage points in a single year, from 156% to 124%, and the gap between interest and revenue narrowed from ₦2.0 trillion to ₦1.5 trillion. “This is the result of reforms working, not a sign of fiscal distress,” the Ministry said.
Third, the Ministry stressed that a half-year snapshot is not a measure of debt sustainability, which it said is assessed on a full-year basis. It pointed out that the same World Bank report projects Nigeria’s full-year 2026 debt service, covering both interest and principal, at 46% of revenue. “This is the appropriate benchmark, and a guide to avoid the invalid conclusions being drawn,” it said.
The Ministry also insisted that all borrowing is lawful and approved. Every naira borrowed by the Federal Government, it said, falls within the limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan.
It added that borrowing is conducted in full compliance with the Fiscal Responsibility Act 2007 and the Debt Management Office (Establishment) Act 2003 and is published regularly by the Debt Management Office.
The Ministry said it welcomes informed scrutiny of public finances but urged analysts and commentators to apply the same rigour they expect of government.
“Compare like with like, read figures in context, and seek clarification where the data is unclear,” it said.
