Nigeria owes China $5.7bn in bilateral loans —World Bank

Africa’s most populous nation Nigeria owed China $5.67bn in bilateral external debt as of the end of 2025, accounting for about 85 per cent of its total $6.68bn obligations to foreign governments, according to the World Bank.

The figure places Asian economic powerhouse China as Nigeria’s largest bilateral creditor, ahead of France, to which the country owed $774m, while other bilateral creditors accounted for $237m.

The World Bank disclosed this in its International Debt Report 2026 uploaded on its website on Friday, which showed that Nigeria’s total external debt stock rose by 6.6 per cent to $145.02bn in 2025 from $136.05bn in 2024.

Bilateral loans are borrowings provided by one government to another, either directly or through government-backed agencies. They are not the same as multilateral loans, which are usually obtained from institutions such as the World Bank and other international development lenders.

Nigeria’s bilateral debt of $6.68bn formed part of its $62.4bn public and publicly guaranteed external debt, which includes direct government borrowing and loans obtained by other entities with government guarantees.

Multilateral creditors accounted for the largest share of the public and publicly guaranteed external debt at $31.37bn, while private creditors held $24.35bn, the 280-page report stated.

Within the multilateral category, the World Bank’s International Development Association accounted for $18.53bn,International Monetary Fund Special Drawing Rights allocations represented $5.52bn, while other multilateral institutions accounted for $7.32bn.

According to the international lender, Nigeria’s total external debt increased from $83.21bn in 2015 to $145.02bn in 2025, representing a rise of approximately 74.3 per cent over the decade.

The country’s external debt comprised $62.4bn in public and publicly guaranteed obligations, $54.48bn in private nonguaranteed debt and $28.14bn in short-term external debt.

Private nonguaranteed debt represents foreign borrowing by private-sector entities without government guarantees, while short-term external debt generally comprises obligations with an original maturity of one year or less.

The rising external debt stock comes as President Bola Tinubu seeks National Assembly approval to raise an additional $7.7bn through international financing sources to partly finance the 2026 budget deficit.

In a letter read by Senate President Godswill Akpabio during plenary on Wednesday, Tinubu requested approval to raise $7.707bn, equivalent to approximately N10.79tn at the budget exchange rate of N1,400 to the dollar.

The proposed borrowing represents the external financing component of the N29.2tn new borrowing provision in the 2026 Appropriation Act, comprising N18.4tn in domestic borrowing and N10.79tn in external financing.

On debt sustainability, the World Bank reported that Nigeria’s external debt-to-exports ratio stood at 212 per cent in 2025, while external debt-to-Gross National Income was 51 per cent.

The debt service-to-exports ratio rose to 19 per cent, while debt service-to-GNI stood at five per cent, indicating the proportion of export earnings and national income equivalent to external debt repayment obligations.

The report also showed that Nigeria’s average interest rate on new external loan commitments from official creditors was 1.9 per cent, compared with 9.6 per cent for private creditors.

“The return of private lending to low- and middle-income countries is welcome, but these countries are borrowing more, paying more, and in many cases leaving less for long-term development,” World Bank Group Chief Statistician and Director of Development Data Haishan Fu stated. “Managing debt responsibly means giving everyone, including future generations, a chance to thrive.”