The Nigerian Economic Summit Group (NESG) has warned that Nigeria remains exposed to significant debt risks, despite some fiscal indicators showing improvement. Weak revenue generation, persistent structural imbalances, and continued reliance on borrowing to finance budget deficits and public spending contribute to this elevated risk.

In its latest assessment, titled “Debt pressure persists beneath surface stability: DBI signals elevated fiscal strain in 2025”, the NESG noted that while certain debt metrics appeared to improve between 2024 and 2025, Nigeria’s broader fiscal condition remains fragile.

The Debt Burden Index (DBI), a comprehensive measure of debt stress, fell to 70.9 points in 2024 from 83.6 points in 2023. However, the NESG cautioned that this decline does not signify a substantial improvement in fiscal health.

The group stated, “Overall, the 2024–2025 transition does not yet reflect a decisive shift toward debt sustainability. Rather, it signals a system making only marginal adjustments, with improvements in headline ratios masking persistent structural imbalances.”

The NESG highlighted that the decline in the DBI was primarily due to a temporary moderation in debt servicing costs, not stronger fiscal capacity, improved revenue mobilization, or structural reforms.

Nigeria’s public debt-to-GDP ratio increased significantly to 40.6% in 2024, reflecting the nation's ongoing dependence on borrowing to cover fiscal deficits.

Looking ahead, the NESG projected the DBI to rise to 78.4 points in the first quarter of 2025 and further to 79.6 points in the second quarter. The index was estimated at 76.2 points in the third quarter before a projected rebound to 79.2 points by the fourth quarter of 2025.

Nigeria's debt profile has faced increased scrutiny as debt servicing obligations consume a substantial portion of government revenues.