The Central Bank of Nigeria (CBN) has revealed that external debt servicing cost the nation approximately $5.47 billion between January 2024 and February 2025, highlighting mounting pressure on government revenues, foreign reserves, and fiscal stability. Additionally, total foreign exchange direct remittances increased by 1.3% year-on-year (YoY) to $180.03 million in the first two months of 2025, according to data from the apex bank. Debt servicing peaked at $854.37 million in May 2024, the highest single-month outflow within the period under review, while the lowest payment of $50.82 million was recorded in June 2024. The CBN’s figures indicate that debt service obligations rose by 1.9% to $283.22 million in February 2025, compared to $276.17 million in March 2024. For Q3 2024, total debt service costs amounted to approximately N3.57 trillion, reflecting a 1.71% quarter-on-quarter increase from N3.51 trillion in Q2. Debt service payments fluctuated significantly, dropping by 22.1% to $215.20 million in April before surging by 297% in May to reach $854.37 million. The figure then plummeted by 94% to $50.82 million in June, before spiking by 967.4% to $542.50 million in July. The trend continued with a 48.4% decline in August to $279.95 million, followed by an 84.2% increase in September to $515.81 million. Debt servicing remained relatively stable in October, rising marginally by 0.01% to $515.86 million, before dropping by 54.9% to $232.50 million in November. A subsequent increase of 41.4% in December pushed the figure to $328.91 million. Entering 2025, payments rose by 64.4% in January to $540.67 million but fell sharply by 48.8% in February to $276.73 million. The volatility in debt service payments underscores persistent pressure on Nigeria’s foreign exchange reserves. Meanwhile, overall debt service costs—including both external and domestic obligations—rose in Q3 2024, reflecting the combined effects of higher external debt service payments and currency depreciation. FX Direct Remittances Rise to $180.03 Million Despite the challenges in external debt servicing, foreign exchange direct remittances recorded a modest increase. According to CBN data, total FX direct remittances rose by 1.3% YoY to $180.03 million in the first two months of 2025, compared to $177.7 million in the same period of 2024. A month-on-month (MoM) breakdown shows that remittances fell to $54.44 million in January 2025 from $138.56 million in January 2024. However, February 2025 saw a sharp increase to $125.59 million—marking a 220.8% surge from the $39.15 million recorded in February 2024. Total FX direct remittances for 2024 stood at $1.91 billion, reflecting a 3.5% decline from the $1.98 billion recorded in 2023. While concerns remain over declining remittance inflows despite a rise in Nigerians relocating abroad, the improved figures in early 2025 suggest that CBN’s ongoing reforms are beginning to yield positive results.
