A World Bank report has thrown a spotlight on the concentration of concessional debt, revealing that Nigeria, Bangladesh, and Pakistan now hold nearly 30% of all International Development Association, IDA-eligible debt.
This statistic was detailed in the International Debt Report 2025 released on Wednesday.
The World Bank’s findings highlighted a substantial debt concentration among a small group of low-income nations.
Specifically, Nigeria, Bangladesh, and Pakistan, along with a few other countries like Mozambique, Senegal, Sri Lanka, and Uzbekistan, collectively account for over half of all IDA-eligible external debt.
According to the World Bank, “Eligibility for IDA support depends first and foremost on a country’s relative poverty, defined as GNI per capita below an established threshold and updated annually ($1,325 in the fiscal year 2026).
“IDA also supports some countries, including several small island economies, that are above the operational cutoff but lack the creditworthiness needed to borrow from the International Bank for Reconstruction and Development (IBRD). Some countries, such as Nigeria and Pakistan, are IDA-eligible based on per capita income levels and are also creditworthy for some IBRD borrowing. They are referred to as “blend” countries.”
Nigeria, for instance, has seen its debt exposure to the IDA climb significantly, retaining its position as one of the top three IDA borrowers globally.
According to the report, the structure of long-term external debt among IDA-eligible countries has remained largely unchanged over the past decade.
The report revealed that public and publicly guaranteed (PPG) debt still makes up 75 per cent of the total, with private non-guaranteed (PNG) debt accounting for the remaining 25 per cent.
PPG debt refers to all long-term external obligations owed by a country’s public sector, including any private-sector debt that is backed by a government guarantee. In contrast, PNG debt covers long-term external obligations incurred by private companies or individuals that carry no government guarantee.
In 2024, the report noted, the debt stock of PPG borrowers rose 2.8 per cent to US$816.5 billion, while PNG borrowers saw a slight decline to US$241.9 billion.
Debt concentration, the report stated, has become more pronounced, with just seven countries of the top ten borrowers holding over half of all IDA-eligible external debt.
The World Bank report also revealed that the total net debt inflows to IDA-eligible countries jumped 18.6 per cent to $53.1 billion in 2024.
The financial institution explained that the jump in total net debt inflows was largely due to a shift in short-term debt flows, which swung from an outflow of $10.6 billion in 2023 to an inflow of $5.6 billion in 2024.
Although long-term debt inflows dropped 14.4 percent, they remained positive at $47.4 billion, still higher than in 2022.
The report also added that long-term flows to PNG borrowers turned negative, moving from an inflow of $7.3 billion to an outflow of $567 million.
This reversal was driven partly by commercial banks and private creditors, whose net flows turned negative for the first time since 1999.
With Nigeria ranking among the top three largest IDA-eligible borrowers, the growing concentration of debt is heightening concerns about the country’s fiscal sustainability, its ability to service external obligations, and its exposure to global financial shocks.
The World Bank report signals the need for stronger debt transparency, more prudent borrowing practices, and improved domestic resource mobilization across vulnerable economies.
The report from the World Bank comes as Nigeria’s total public debt climbed to N152.39 trillion in the second quarter of 2025, up from N149.38 trillion recorded in the first quarter.
The Debt Management Office (DMO) reports that Nigeria’s external debt stood at $46.98 billion (N71.85 trillion) in June, up from $45.98 billion (N70.63 trillion) in March.
The agency also reported that Nigeria’s external debt service payments rose to $932.1 million in the second quarter of 2025.
