Nigeria’s public debt stock reached a record peak of ₦166.79 trillion at the end of June 2026, according to recent figures released by the Debt Management Office. Despite this surging liability, the Federal Government has entered into talks with the World Bank to secure three new credit facilities amounting to 1.5 billion dollars.
The national debt increased by 9.44 per cent year-on-year, rising by ₦14.39 trillion from ₦152.40 trillion in June 2025. The public debt expanded by 21.35 per cent over the same twelve-month period, climbing from 99.66 billion dollars to 120.93 billion dollars. The sharper rise in dollar terms stems from exchange rate valuations, as the DMO applied an official rate of ₦1,379.1842 to the dollar for June 2026, compared to ₦1,529.2105 a year earlier. Quarter-on-quarter, total debt grew by 4.67 per cent from ₦159.35 trillion in March 2026.
Domestic commitments continue to form the larger share of the country’s obligations, standing at ₦91.59 trillion or 54.91 per cent of the total, whilst external liabilities account for ₦75.20 trillion or 45.09 per cent. Domestic debt grew by 13.70 per cent from ₦80.55 trillion in June 2025, while external liabilities rose by 16.05 per cent in dollar terms from 46.98 billion dollars to 54.52 billion dollars. The central government holds the bulk of these debts, accounting for ₦87 trillion in domestic liabilities and ₦65.77 trillion in external debt, while state governments and the Federal Capital Territory owe ₦4.59 trillion domestically and ₦9.42 trillion externally.
Against this backdrop of expanding public debt, documents obtained from the World Bank indicate that the Federal Republic of Nigeria is negotiating three separate 500 million dollar facilities from the International Development Association, the lender’s concessional window. The proposed credit lines target environmental protection, social safety nets, and early childhood development.
The most advanced proposal involves 500 million dollars in additional financing for the Agro-Climatic Resilience in Semi-Arid Landscapes project, executed by the Federal Ministry of Environment. Slated for World Bank board consideration on 29 October 2026, the facility will increase overall project funding from 700 million dollars to 1.2 billion dollars.
Official documentation records that “The Government of Nigeria has requested AF of $500m to scale up demonstrated project results and strengthen the institutional, operational and financing arrangements needed to sustain integrated landscape management.”
The funds will be allocated with 310 million dollars for dryland management, 165 million dollars for community climate resilience, and 25 million dollars for institutional strengthening across 19 northern states and the Federal Capital Territory. The project addresses land degradation and desertification, which the lender notes affects 43 per cent of Nigeria’s land mass, warning that unchecked climate risks could reduce gross domestic product by 2.6 per cent annually by 2030 and up to 6.7 per cent by 2050.
A second 500 million dollar facility is being prepared for the Household Prosperity and Empowerment-Social Protection Project, implemented by the Federal Ministry of Humanitarian Affairs and Poverty Reduction with the Federal Ministry of Finance as borrower. Scheduled for technical review on 30 October 2026 ahead of a tentative approval date on 16 March 2027, the programme blends a 420 million dollar results-based component with an 80 million dollar investment allocation.
World Bank documents show the project aims to establish “a sustainable social assistance to poor and vulnerable households, financed increasingly from federal and state budgets and delivered through strengthened state and local government systems.” The scheme will fund conditional and unconditional cash transfers, update the national social registry, link National Identification Numbers to social protection systems, and bolster implementation across federal, state, and local governments.
The lender noted that Nigeria allocated only 0.14 per cent of gross domestic product to social safety nets in 2021, compared to a lower-middle-income country average of 1.2 per cent and a global benchmark of 1.5 per cent. The World Bank also highlighted deteriorating welfare metrics, estimating that poverty levels rose from 40 per cent in 2019 to 56 per cent in 2023, with projections indicating a potential rise to 62.5 per cent in 2026 as inflation, conflict, natural disasters, fuel subsidy removals, and currency reforms weigh on household budgets.
The third 500 million dollar credit facility targets the Nigeria Early Childhood Development programme, consisting of a 400 million dollar programme-for-results structure and a 100 million dollar investment component. Set for technical review on 30 October 2026 and board consideration on 15 March 2027, the Federal Ministry of Budget and Economic Planning will implement the initiative across all 36 states and the Federal Capital Territory. The project focuses on expanding access to healthcare, early learning, nutrition, childcare, and sanitation for children aged zero to five.