World Bank: Nigeria spends 124% of revenue on interest alone

Nigeria's revenue collections are improving. Its interest bill is improving faster.

The World Bank's October 2026 Nigeria Development Update, *Beyond the Federal Purse: How Higher Revenues Shaped State Priorities*, reports that the Federal Government spent N7.7tn on interest payments in the first half of 2026 — 124.2 per cent of the N6.2tn in total revenue it collected over the same six months. That leaves a shortfall of N1.5tn before a single naira is allocated to salaries, roads, clinics or classrooms.

The increase is steep. Interest payments rose by N2.1tn, or 37.5 per cent, from N5.6tn in the first half of 2025, climbing to 3.1 per cent of GDP from 2.5 per cent. The World Bank attributes the rise to high domestic borrowing costs.

Separate data from the Debt Management Office's Q1 2026 domestic debt service report shows N3.14tn spent servicing domestic debt in the quarter — N2.97tn in interest and N169.68bn in principal. Interest accounted for about 94.6 per cent of that total.

The pressure is regional, not only Nigerian. The World Bank's October 2026 Africa Economic Update warns that nearly 80 per cent of sub-Saharan African countries spend more on public debt interest than on healthcare, education or both.

Meanwhile, the Tinubu Support Group credits the administration's fiscal reforms for rising national revenue, citing over N21.6tn generated in the first half of 2026 and tax revenue of N16.80tn in the first five months.

There is one tentative signal in the other direction. Nigeria's central bank sold 182-day Treasury bills at 15.8 per cent, the lowest yield since December, after the biggest interest-rate cut in almost two decades. Lower yields, if sustained, would reduce the cost of new domestic borrowing. Whether that translates into relief depends on how much of the existing stock of debt is refinanced at those rates, and how quickly.

The evidence covers January to June 2026 only.

What it does show is arithmetic. Revenue is rising. So is the cost of the debt. At current levels, the second is outrunning the first.