In a statement issued on Sunday, 18 October 2026, the ministry described the interpretation of figures in the World Bank’s October 2026 Nigeria Development Update as misleading.
The report put interest payments at ₦7.7 trillion against federal revenue of ₦6.2 trillion during the period. However, the ministry said the interest figure included payments made by the Federal Government on behalf of other tiers of government, including external loans owed by state governments.
“Measuring this against federal revenue alone overstates the ratio, which is only meaningful when debt and revenue cover the same level of government,” the ministry said.
It also argued that the revenue figure excluded income already earned by government agencies and enterprises but not yet remitted to the Treasury.
The ministry said the timing of statutory tax payments meant revenue collections were generally higher in the second half of the year, making a six-month comparison an incomplete measure of the country’s debt position.
“This is why the ratio stood at 156% in H1 2025, while the full-year 2025 debt-service-to-revenue ratio was below 60%, down from 97% before the reforms. This is a clear sign of the progress delivered by the current administration’s reforms,” the statement said.
The ministry maintained that revenue growth had outpaced the increase in interest costs even when the figures for the first halves of 2025 and 2026 were compared.
“Between the first half of 2025 and the first half of 2026, federal revenue rose by 72%, from ₦3.6 trillion to ₦6.2 trillion. Interest payments rose by a much slower 38%, from ₦5.6 trillion to ₦7.7 trillion,” it said.
According to the ministry, the interest-to-revenue ratio consequently fell by 32 percentage points, from 156 per cent in the first half of 2025 to 124 per cent in the corresponding period of 2026.
It added that the gap between interest payments and revenue narrowed from ₦2 trillion to ₦1.5 trillion.
“This is the result of reforms working, not a sign of fiscal distress,” the ministry said, maintaining that debt sustainability should be assessed using full-year figures rather than a six-month snapshot.
The ministry also cited the World Bank report’s projection that full-year debt service in 2026, including principal and interest payments, would amount to 46 per cent of revenue. It described the projection as a more appropriate benchmark for assessing the country’s fiscal position.
Defending the Federal Government’s borrowing practices, the ministry said all federal borrowing fell within the limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan.
“Every naira borrowed by the Federal Government falls within the limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan,” it said.
The ministry added that borrowing complied with the Fiscal Responsibility Act 2007 and the Debt Management Office (Establishment) Act 2003, with information on borrowing regularly published by the Debt Management Office.
While welcoming scrutiny of public finances, the ministry urged analysts and commentators to compare like-for-like figures, consider the relevant context and seek clarification where the data was unclear.
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