Nigeria has maintained its position as the third-largest borrower from the International Development Association, the concessional lending arm of the World Bank, with its outstanding debt climbing to $18.2 billion as of June 30, 2025.
This marks a 10.3 per cent increase from the $16.5 billion recorded in June 2024, according to the latest financial statements released by the IDA.
Nigeria initially rose to third place in 2024, moving up from fourth in 2023, and has now held the position for the second year in a row.
The IDA offers low-interest or interest-free loans with extended repayment periods, aimed at supporting less affluent countries.
According to a report by The PUNCH, Nigeria secured no less than $2.2 billion in new IDA loans between July 2023 and June 2024, bringing the total disbursements to $3.9 billion during the two years of President Bola Tinubu’s administration.
These figures do not include additional borrowings from the International Bank for Reconstruction and Development, which is the World Bank’s non-concessional lending institution.
On a global scale, Bangladesh remains the top IDA borrower with $22.6 billion in outstanding loans, followed by Pakistan with $19.3 billion. Nigeria follows in third place, ahead of India whose exposure dropped to $14.2 billion due to increased repayments, and Ethiopia with $14 billion.
Figures from Nigeria’s Debt Management Office show that by March 2025, the country’s total debt to the World Bank stood at $18.23 billion, making up around 39.7 per cent of its total external debt. Out of this, $16.99 billion was owed to the IDA, while $1.24 billion came from the IBRD.
Economists have raised concerns about the sustainability of Nigeria’s growing dependence on concessional loans. Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, emphasized the need for borrowed funds to be linked to projects that generate revenue and spur economic growth. He warned, “Debt must be tied to projects that boost revenue and growth,” adding that excessive foreign borrowing could increase exchange rate vulnerabilities and put pressure on the country’s foreign reserves if not managed carefully.
