The Federal Ministry of Finance has pushed back against claims that the Federal Government’s interest payments reached 124 per cent of revenue in the first half of 2026. It called the conclusion misleading in a statement issued in Abuja on 18 October 2026.
By: Tunji Okunlola
The Ministry said the claim, which commentators drew from the World Bank’s October 2026 Nigeria Development Update, was based on analysis that did not stand up. It gave three reasons.
Mismatched figures
The Ministry said the interest figure includes debt the Federal Government services on behalf of other tiers of government, including external loans to states. Setting it against federal revenue alone overstates the ratio, it argued, because the comparison only works when debt and revenue cover the same level of government.
It also said the revenue figure is incomplete. According to the Ministry, it leaves out independent revenue that government agencies and enterprises have earned but not yet remitted to the Treasury. It added that more revenue usually comes in during the second half of the year because of the statutory timing of some tax payments. That, it said, is why the ratio stood at 156 per cent in the first half of 2025, while the full-year 2025 debt-service-to-revenue ratio was below 60 per cent, down from 97 per cent before the reforms.
Improvement year on year
The Ministry said that even on the same calculation, the position has improved. Between the first halves of 2025 and 2026, federal revenue rose 72 per cent, from ₦3.6 trillion to ₦6.2 trillion, while interest payments rose 38 per cent, from ₦5.6 trillion to ₦7.7 trillion. The interest-to-revenue ratio therefore fell 32 percentage points, from 156 per cent to 124 per cent, and the gap between interest and revenue narrowed from ₦2.0 trillion to ₦1.5 trillion. The Ministry described this as evidence that reforms are working and not a sign of fiscal distress.
Full-year view
The Ministry said debt sustainability should be judged over a full year, not six months. It noted that the same World Bank report projects full-year 2026 debt service, covering interest and principal, at 46 per cent of revenue, which it called the proper benchmark.
Borrowing “lawful and approved”
The Ministry also said all federal borrowing falls within limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan. It said borrowing complies 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 scrutiny of public finances but urged analysts to compare like with like, read figures in context and seek clarification where data is unclear.
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