Nigerian states have collectively spent approximately N139.92 billion on external debt servicing in the first half of 2024, marking a significant increase from the N63.06 billion spent during the same period in 2023. This represents a 122% surge in debt service costs, largely driven by the devaluation of the naira.
Data from the National Bureau of Statistics (NBS), sourced from the Federal Account Allocation Committee (FAAC), shows that states, which previously spent around N9 billion monthly in 2023, now allocate over N20 billion to service their external debt in 2024.
The following are the top 10 Nigerian states with the highest external debt service costs in the first six months of 2024:
1. Lagos State
Lagos, Nigeria’s commercial hub, tops the list, with N32.44 billion spent on external debt servicing in 2024, a sharp rise from N16.88 billion in 2023. This represents an increase of N15.56 billion or 92.2%.
2. Kaduna State
Kaduna, a key economic center in northern Nigeria, has seen its debt servicing costs surge by 133.4%. The state spent N23.08 billion in 2024, up from N9.89 billion in 2023.
Cross River State
3. Cross River, known for its tourism industry, recorded an external debt service cost of N7.87 billion in 2024, compared to N2.21 billion in 2023. This represents a staggering increase of 255.9%, or N5.66 billion.
4. Oyo State
Oyo, a southwestern state with strong agricultural ties, saw its external debt servicing costs increase by 143.7%, rising from N2.61 billion in 2023 to N6.36 billion in 2024.
5. Bauchi State
Bauchi, rich in agricultural and mineral resources, spent N6.33 billion on external debt servicing in 2024, up from N3.28 billion in 2023, marking a 92.8% increase.
6. Edo State
Edo State, home to the historic Benin Kingdom, experienced a 144.8% rise in its debt service cost, spending N5.9 billion in 2024, compared to N2.4 billion the previous year.
7. Rivers State
Rivers, one of Nigeria’s wealthiest states due to its oil resources, spent N4.6 billion on external debt servicing in 2024, up from N1.76 billion in 2023, reflecting a 161.9% increase.
8. Ogun State
Ogun, a major industrial center, recorded an external debt service cost of N4.29 billion in 2024, a 172.5% rise from the N1.57 billion it spent in 2023.
9. Adamawa State
Adamawa, a northeastern state known for agriculture, saw its debt servicing costs increase by 80.7%, from N1.98 billion in 2023 to N3.57 billion in 2024.
10. Osun State
Osun, famed for its cultural heritage, recorded an external debt service cost of N3.4 billion in 2024, compared to N1.57 billion in 2023, marking an increase of 116%.
The sharp rise in external debt service costs has raised concerns over the growing debt burden on Nigerian states, particularly in the face of economic challenges and currency devaluation. Many experts are urging state governments to adopt more sustainable debt management strategies to mitigate future risks.
