The foreign debt owed by Nigerian companies increased by 179.6 per cent in seven years, rising from $19.49bn in 2018 to $54.48bn in 2025, according to the World Bank.
The increase means Nigerian businesses now owe foreign creditors almost three times the amount they owed in 2018.
The World Bank disclosed this in its International Debt Report 2026, which put Nigeria’s private sector nonguaranteed external debt at $54.476bn as of December 2025.
The bank explained that a country’s total external debt comprises public and publicly guaranteed debt, private nonguaranteed debt and short-term debt.
It defined private sector nonguaranteed external debt as funds borrowed by private companies from foreign banks, investors and other lenders without repayment guarantees from the government or any public institution.
“Private nonguaranteed debt comprises long-term external obligations of private debtors that are not guaranteed by a public entity.
“Public and publicly guaranteed external debt comprises long-term external obligations (maturities of over one year) of all public debtors, including debt held by the central government and by state-owned enterprises. Short-term debt is defined as debt with an original maturity of one year or less ,” the report said.
The 179.6 per cent increase in private sector external debt over the seven-year period exceeded the growth in government-backed foreign debt, which rose by 155.5 per cent from $24.422bn in 2018 to $62.4bn in 2025.
The report indicated that foreign borrowing by private companies was becoming an increasingly significant component of Nigeria’s external debt.
In 2018, private sector nonguaranteed debt accounted for about 79.8 per cent of public and publicly guaranteed external debt. By 2025, the proportion had increased to 87.3 per cent.
Meanwhile, Nigeria’s total external debt, comprising government borrowing, private sector foreign loans and short-term obligations, climbed from $46.238bn in 2018 to $145.015bn in 2025.
The World Bank report also highlighted the higher borrowing costs associated with private foreign creditors.
According to the bank, new loans obtained by Nigeria from private foreign lenders in 2025 attracted an average interest rate of 9.6 per cent, compared with 1.9 per cent for loans from official creditors, including foreign governments and multilateral institutions.
Private creditors also offered an average repayment period of 12 years, significantly shorter than the 25-year average provided by official creditors.