Fresh data from the Debt Management Office (DMO) and the Central Bank of Nigeria (CBN) revealed that President Bola Tinubu’s government has already borrowed N8.1trn domestic loans in the first three months of 2026.
This rapid accumulation of debt comes amid intensified efforts by the administration to fund the N17.89 trillion deficit in the 2026 national budget, raising fresh concerns among economic analysts regarding long-term sustainability.
The surge in borrowing, which averages approximately N2.7 trillion per month since January, is primarily driven by a mix of domestic bond issuances and new external credit lines.
According to the quarterly report, the domestic debt market bore the brunt of this activity, with the government leaning heavily on FGN Bonds and Savings Bonds to shore up liquidity.
Analysis of the data revealed that Nigeria’s domestic borrowing increased by 7.4 per cent after Tinubu’s government borrowed N8.1trn in the first three months of 2026.
This is an increment from N7.5 trillion in the same period of 2025.
Further analysis revealed that the increment in the domestic borrowing in Q1’26 was driven by 63 per cent and 24 per cent YoY increase in borrowing through FGN Bonds and FGN Savings Bonds, respectively, which offset 12 per cent decline in borrowing through Treasury Bills.
Tinubu’s administration borrowed N4.86 trillion through Treasury Bills in Q1’26, representing a 12 per cent YoY decline from N5.54trn in Q1’25.
However, borrowing from the monthly FGN Bond auctions rose by 63 per cent YoY to N3.182trn in Q1 ’26 from N1.953trn in Q1’25.
Similarly, borrowing through the FGN Savings Bond rose by 24 per cent YoY to N16 billion in Q1’26 from N13 billion in Q1’25.
Under the Appropriation Act 2026, the Federal Government plans to borrow N29.2trn, to fund the gap between the revenue of N68.32 trillion, and expenditure of N36.87 trillion. This indicates a quarterly borrowing target of 7.3trn, including external debt.
However, given the N8.1 trillion borrowed from domestic investors in Q1’26, and the $6 billion new external loans approved by the National Assembly two weeks ago, the Federal Government might again exceed its annual borrowing target in 2026.
The above trend also indicates further increases in Nigeria’s debt stock which according to the DMO, stood at N153.29 trillion at the end of Q3 ’25, representing a 5.9 per cent YoY increase from N144.67 trillion at the end of 2024.
The revelation that Tinubu’s government has borrowed N8.1trn in the first three months of 2026 comes as the World Bank has lamented that Nigeria’s massive debt-service burden was systematically crippling the nation’s ability to fund critical infrastructure, effectively reducing capital investment to a “primary adjustment margin” in the federal budget.
In its latest Nigeria Development Update (NDU) for April 2026, released last week, the World Bank disclosed that while the debt-to-GDP ratio appears moderate, the cost of servicing that debt is suffocating.
“Although Nigeria’s debt-to-GDP ratio remains low by international standards, the main source of vulnerability is the high debt service-to-revenue ratio, which is estimated to have stood at 49.5 percent in 2025,” the Bank stated.
This fiscal “squeeze” has directly impacted the Federal Government’s (FGN) development goals. The report noted that: “With recurrent spending absorbing most of the available fiscal space, capital spending declined from 1.3 percent of GDP in 2024 to 1.0 percent in 2025”.
The bank further revealed a staggering failure in project execution: “Capital execution was particularly weak, with only 24 percent of the prorated 2025 capital budget of MDAs implemented, leaving a significant portion of approved investment unspent and limiting the growth impact of public spending”.
Warning of the long-term consequences for Nigeria’s economic future, the lender emphasised “The ratio continues to crowd out pro-growth spending, particularly on infrastructure and human capital”. Even with projected improvements, the bank cautioned that the burden will remain high: “The debt service-to-revenue ratio… will remain elevated at about 41 percent by 2028, constraining fiscal flexibility and limiting space for priority development spending”.
