FG Challenges World Bank’s Debt Assessment As Interest Bill Hits N7.7tn

…Faults Reliance On Half-Year Revenue Figures To Assess Fiscal Health

…Projects Full-Year Debt Service At 46% Of Revenue

The Federal Government has challenged the World Bank’s evaluation of Nigeria’s debt burden, arguing that the reported ratio of curiosity funds to income within the first half of 2026 doesn’t absolutely replicate the nation’s fiscal place.

The Ministry of Finance mentioned the reported 124 per cent ratio, which signifies that federal curiosity funds exceeded income for the six-month interval, was deceptive as a result of it relied on incomplete income figures and didn’t account adequately for seasonal differences in authorities receipts.

The World Bank’s October 2026 Nigeria Development Update reported that the Federal Government’s curiosity funds rose to N7.7tn within the first half of 2026, in contrast with income of N6.2tn, leaving a shortfall of N1.5tn.

In an announcement issued on Sunday, the ministry mentioned the calculation didn’t seize all income out there to the federal government, together with earnings generated by impartial companies however not but remitted into the related accounts.

It additionally argued that the curiosity determine included debt obligations serviced on behalf of subnational governments, together with exterior loans contracted by states.

According to the ministry, these elements make the headline ratio an incomplete measure of the Federal Government’s fiscal efficiency.

The ministry mentioned income elevated by 72 per cent, from N3.6tn within the first half of 2025 to N6.2tn within the corresponding interval of 2026, whereas curiosity funds rose by 38 per cent, from N5.6tn to N7.7tn.

It added that the interest-to-revenue ratio had declined from 156 per cent within the first half of 2025 to 124 per cent within the first half of 2026, whereas the hole between curiosity funds and reported income narrowed from N2tn to N1.5tn.

The ministry maintained that the figures confirmed an enchancment in income efficiency relative to curiosity prices, though the reported curiosity invoice remained greater than the income recorded in the course of the interval.

It additional argued that the first-half figures shouldn’t be handled as an entire illustration of the full-year fiscal place as a result of tax receipts usually strengthen within the second half of the 12 months.

The authorities projected that complete debt service, overlaying each curiosity funds and principal repayments, would account for 46 per cent of income for the complete 12 months in 2026.

It additionally mentioned the full-year debt-service-to-revenue ratio for 2025 was beneath 60 per cent, in contrast with 97 per cent earlier than the present administration’s reforms.

However, the ministry’s projected full-year ratio makes use of a unique measure from the World Bank’s first-half calculation.

The World Bank’s 124 per cent determine compares curiosity funds with income for the primary six months of 2026, whereas the ministry’s 46 per cent projection covers complete debt service, together with principal repayments, towards full-year income.

The two ratios subsequently can’t be immediately in contrast with out accounting for the totally different intervals and measures used.

The ministry additionally defended the federal government’s borrowing programme, saying borrowing had been undertaken inside permitted limits and in accordance with relevant legal guidelines and authorisations by the National Assembly.

Despite the federal government’s defence, the reported figures underscore the strain that debt curiosity funds proceed to position on federal funds.

Interest prices of N7.7tn exceeded the N6.2tn in income recorded within the first half of the 12 months, highlighting the significance of stronger income mobilisation and efficient administration of public debt.

The ministry mentioned the federal government anticipated improved receipts within the second half of the 12 months to scale back the general debt-service burden as a proportion of income.