Financial analysts at Afrinvest have warned that Nigeria’s total public debt may climb to ₦180 trillion by the end of 2025 if the country’s current fiscal trajectory is not urgently corrected. This projection is contained in the latest Afrinvest Weekly Market Report, which also reviewed insights from the World Bank’s recent Nigeria Development Update and figures from the National Bureau of Statistics (NBS).
According to Afrinvest, Nigeria’s macroeconomic environment has seen some gains in 2024, including positive reforms in foreign exchange policies, tighter monetary policy, and increased revenue collection. However, the firm raised concerns that these improvements might not be sustainable due to weak oil performance and continuous government spending.
Afrinvest projected that the budget deficit for 2025 could surpass ₦17 trillion. If that happens, the country’s total debt stock may rise from ₦144.7 trillion recorded at the end of 2024 to around ₦180 trillion by December 2025, representing roughly 65 per cent of Nigeria’s Gross Domestic Product (GDP).
The firm flagged the country’s crude oil production as a major risk. As of April 2025, Nigeria was producing only 1.49 million barrels per day, which is well below the 2.06 million barrels per day benchmark in the 2025 national budget. At the same time, oil prices have averaged $64 per barrel—lower than the $75 per barrel benchmark—creating a potential 37.9 per cent revenue shortfall from the projected ₦19.5 trillion in oil income.
Despite the warning, Afrinvest noted several positive developments. These include a $6.8 billion balance of payments surplus in 2024 and a strong 110 per cent increase in foreign portfolio inflows, which rose from $6.4 billion in 2023 to $13.4 billion in 2024. The surge was linked to the Central Bank of Nigeria’s (CBN) hawkish policies, such as raising the Monetary Policy Rate to 27.50 per cent and issuing over ₦10.2 trillion in Open Market Operations (OMO) bills that attracted foreign investors.
Nigeria’s gross revenue collection also increased significantly, rising from ₦16.8 trillion in 2023 to ₦31.9 trillion in 2024. This growth was largely due to improved Value Added Tax (VAT) collection and higher foreign exchange gains following the unification of exchange rates.
However, inflation is still a pressing issue. Headline inflation eased slightly to 23.7 per cent in April 2025 after a rebasing of the Consumer Price Index, but the World Bank still projects an average inflation rate of 22 per cent for the full year. Analysts say the high inflation, if not tackled properly, may erode the benefits of fiscal and monetary policy reforms.
Afrinvest advised the Federal Government to build on recent progress by channeling increased revenues into infrastructure development, improving security—especially to boost agriculture—and addressing crude oil theft to help the country meet its oil production targets. The report also stressed the importance of cutting down the cost of governance to manage the debt burden effectively.
It said the recent subsidy removals on petrol, electricity, and foreign exchange present an opportunity for the government to lay the foundation for sustainable economic growth. Afrinvest urged policymakers to “double down” on reforms and avoid reversing key policies, as this could undermine investor confidence.
