The World Bank says Nigeria’s main fiscal problem is weak revenue, not too much debt, and it urged the government to focus on raising revenue to support sustainable growth.
Speaking on Channels Television on Friday, July 3, the World Bank Country Director for Nigeria, Mathew Verghis, said Nigeria’s debt profile is moderate by international standards and unlike countries in debt distress.
“From our assessment, Nigeria doesn’t have a high indebtedness problem; it has a low revenue problem,” Verghis said.
He pointed out that Nigeria’s debt-to-GDP ratio is lower than many comparable countries and that borrowing shouldn’t be the only worry.
“When we looked at the numbers, Nigeria is a moderately indebted country, meaning it has less debt relative to its economy than most of its neighbors and many other countries,” he said. “Nigeria is in a very different situation than Ghana, for example, which is going through a debt restructuring.”
Verghis defended borrowing for long-term investment.
“Nigeria borrows for the same reasons that all countries borrow. If you want to deliver results to people, the money available on an annual basis is not enough. So you borrow, deliver results, and that improves your ability to repay,” he said.
He used electricity expansion as an example, noting the big upfront costs to reach millions.
“To be able to connect and provide energy to 32 million Nigerians, Nigeria needs to borrow money now. But with increased access to energy, the country will become wealthier and better positioned to repay the loans,” he added.
He warned low government revenue is a bigger threat.
“Nigeria’s debt is not particularly high, and in fact, it’s quite moderate by international standards. Its revenues are very low by international standards, and unless those revenues are raised, it will not be able to pay back debt,” Verghis said.
Strengthening revenue collection, he said, would let the government invest more in infrastructure, healthcare, education and other sectors that create jobs and reduce poverty.
The remarks come as the World Bank unveiled a new Country Partnership Framework for Nigeria for 2026–2032, which puts job creation at the center of support through investments in infrastructure, healthcare, agriculture and digital connectivity.
