The Central Bank of Nigeria (CBN) has projected the country’s public debt-to-GDP ratio to reach 34.68 per cent by the end of 2026, maintaining a sustainable trajectory.
Okay News reports that the forecast, outlined in the CBN’s 2026 Macroeconomic Outlook, represents a modest rise from 33.98 per cent recorded at the end of June 2025.
The slight increase is attributed to anticipated new borrowings under ongoing fiscal policies.
The apex bank emphasised that debt sustainability remains intact, as major past drivers like exchange rate volatility are expected to diminish significantly.
Sharp naira depreciation between 2023 and 2025 had inflated the local currency value of external debt, dominating debt accumulation during that period.
Improved exchange rate stability in 2026 is projected to substantially reduce these valuation effects.
Debt growth will increasingly depend on traditional factors such as the primary fiscal balance, bolstered by revenues from the Tax Act of 2025 and real economic expansion.
The outlook signals a transition toward debt dynamics driven by fiscal fundamentals rather than external currency shocks.
Stronger revenue mobilisation and growth could enhance debt service capacity and lower borrowing costs.
This aligns with broader international assessments, including the World Bank’s projection of Nigeria’s public debt falling below 40 per cent of GDP for the first time in over a decade.
