Nigeria’s Federal Government has challenged the World Bank’s assessment that interest payments on public debt exceeded federal revenue in the first half of 2026, arguing that the calculation presents an incomplete picture of the country’s fiscal position. In a statement issued on 18 October, the Federal Ministry of Finance described the reported debt interest-to-revenue ratio of 124 per cent as misleading, contending that it combined obligations serviced on behalf of multiple tiers of government with revenue attributed only to the Federal Government. The dispute follows the World Bank’s October Nigeria Development Update, which reported that the government paid ₦7.7 trillion in interest between January and June 2026, against federal revenue of ₦6.2 trillion. The figures imply a shortfall of ₦1.5 trillion between interest costs and revenue collected during the period, according to reports by Premium Times and The PUNCH.
The Finance Ministry argued that the World Bank’s comparison excludes independent revenue earned by government agencies and enterprises but not yet remitted to the Treasury. It also said the interest figure includes debt obligations the Federal Government services on behalf of state governments, including external loans, making a comparison against federal revenue alone potentially overstated. To support its position, the ministry said federal revenue increased by 72 per cent year on year, from ₦3.6 trillion in the first half of 2025 to ₦6.2 trillion in the same period of 2026, while interest payments rose by 38 per cent, from ₦5.6 trillion to ₦7.7 trillion. The ministry added that tax collection patterns typically result in higher revenue in the second half of the year and cited the World Bank’s projection that full-year 2026 debt service, including both interest and principal repayments, would amount to 46 per cent of revenue. These are the government’s arguments for assessing the fiscal position using a broader, full-year comparison, rather than the six-month ratio alone.
The disagreement comes as Nigeria continues to face pressure from high domestic borrowing costs and competing demands on public spending. The World Bank’s report said interest payments rose to 3.1 per cent of gross domestic product in the first half of 2026, from 2.5 per cent a year earlier, while reported capital spending fell to approximately ₦700 billion. The figures raise questions about how much funding remains available for infrastructure and other development priorities, even as government revenue improves. Although the Finance Ministry maintains that revenue is growing faster than interest costs and that borrowing complies with approved legal limits, the dispute highlights the importance of transparent, comparable fiscal data. A clearer reconciliation of the revenue and debt obligations included in each calculation would help investors, policymakers and the public assess the sustainability of Nigeria’s borrowing and the resources available for economic development.
