The Federal Government (FG) has borrowed N17.36 trillion from domestic and foreign sources in the first 10 months of this year.
This represents N6.06 trillion (55.6 per cent) in excess of the N10.9 trillion stipulated in the 2025 Appropriation Act on 10 months prorate bases. The total borrowing in 2025 approved budget is N13.08 trillion for the entire fiscal year.
The breakdown of the 2025 borrowings so far shows a N15.8 trillion from domestic sources as at October 2025 and N1.56 trillion from the external sources as at first half of 2025.
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Meanwhile, the FG last week initiated moves to borrow $2.35 billion (N3.384 trillion) via the Eurobond issuance.
This would increase the total borrowing to N20.74 trillion.
Also, going by the periodic domestic borrowing template operated this year, the estimated total borrowing for the year is put at nearly N23 trillion, bringing total excess borrowing for the year to about N10 trillion, or 80% in excess of the amount in the Appropriation Act 2025.
Financial analysts warn that this persistent overshoot, amid weak revenue performance, heightens the risk of a self-reinforcing debt trap, erodes foreign investor confidence, and threatens private sector access to credit — with knock-on effects on business expansion, job creation, and the general cost of living.
FG, in the Appropriation Act 2025, projected N54.99 trillion xpenditure and N41.91 revenue. This resulted in a deficit of N13.08 trillion, which is to be financed through domestic and external borrowing.
Based on this, the borrowing target for the first ten months was N10.9 trillion, equivalent to N1.09 trillion monthly.
However, data from the Debt Management office, DMO, and the Central Bank of Nigeria, CBN, showed that the FG borrowed N15.8 trillion from domestic investors from January to October (10M’25) through monthly FGN Bond auctions, FGN Savings Bonds, Sukuk Bond and Treasury Bills.
Financial analysts pointed out that by overshooting its borrowing target amidst rising revenue, the FG is continuing with fiscal indiscipline which hallmarked the immediate past fiscal regime under late president Mohammadu Buhari.
They also said this development poses threat to private sector access to credit and economic growth and debt sustainability efforts.
The experts also warned that FG’s excessive borrowing undermines IMF-backed fiscal consolidation efforts.
Breakdown of borrowings
The breakdown of the FG borrowings so far this year show that it borrowed N11.43 trillion in 10M’25 through Treasury Bills (Primary Market Auctions), representing a 4.6 per cent, year-on-year, YoY, increase from N10.925 trillion in 10M’24.
The FG, however, reduced its borrowing through FGN Bonds by 22 per cent, YoY to N4.042 trillion in 10M’25 from N5.15 trillion in 10M’24.
But borrowing through the FGN Savings Bond auction rose by 5.6 per cent, YoY to N40.19 billion in 10M’25 from N38.06 billion in 10M’24.
Similarly, FG raised its borrowing through Sukuk Bond issuance to N300 billion in 10M’25 from zero issuance in 10M’24.
Why FG increased borrowing
Andrew Uviase, Managing Partner at Ecovis OUC, described the escalating borrowing as “a clear reflection of fiscal indiscipline and poor expenditure control.”
According to him, “the government still needs to do a lot more in reducing and controlling the cost of governance. The present situation suggests the government is not bothered about its spending pattern, and without honesty and transparency, we will continue to see excessive borrowing because, realistically, money is never enough.”
He also noted that non-oil revenue performance has remained disappointing, despite improvements in tax collection by the Federal Inland Revenue Service (FIRS).
“Other non-oil sources are not meeting expectations, and insecurity continues to stifle farming and other economic activities that could boost revenue,” he said.
David Adonri, Vice Executive Chairman of Highcap Securities, blamed the borrowing surge on “aggressive and unrealistic revenue assumptions,” particularly oil-related.
“The 2025 budget was anchored on an oil production target of 2.06 million barrels per day and a price of $75 per barrel — both overly optimistic,” he said. “Actual production has hovered around 1.6 to 1.7 million barrels, while prices have fallen to about $65.”
Adonri warned that the Federal Government’s “addiction to debt” and “brazen fiscal indiscipline” continue to undermine fiscal consolidation. “Despite claims of increased revenue from the removal of fuel and FX subsidies, government spending keeps expanding, and borrowing has become a narcotic,” he said.
Similarly, Tunde Abidoye, Head of Research at FBNQuest Merchant Bank, echoed Adonri’s view, describing the oil benchmarks in the 2025 budget as “overly optimistic,” which he said inevitably leads to “revenue shortfalls and higher borrowing.”
Clifford Egbomeade, a public analyst, attributed the borrowing overshoot to a combination of weak revenue and rising debt-service costs.
“Owing to oil production averaging 1.35–1.4 million barrels per day and inflation eroding consumption, VAT and company tax receipts fell below projections. This forced the Treasury to turn to the domestic market,” he explained.
Egbomeade added that “double-digit yields of over 20% at bond auctions and the deferral of Eurobond issuance due to high global interest rates expanded the government’s cash needs, pushing it into reactive liquidity borrowing rather than strategic deficit management.”
