When Nigeria returned to the Eurobond market in November 2025, the move sparked debate across Africa’s financial circles. Was this another round of debt accumulation, or a calculated signal that Africa’s largest economy is repositioning itself in global capital markets?
Eurobonds in Context
Eurobonds are debt instruments issued in a foreign currency, typically the US dollar. They allow countries to raise capital from international investors and access deep global liquidity beyond domestic banking systems.
Since Ghana’s debut Eurobond in 2007, more than 20 African countries, from Côte d’Ivoire to Ethiopia, have raised funds in international markets. The appeal lies in packaging large sums in one transaction, signalling global-market credibility, and expanding the investor universe.
However, the risks are significant. Currency risk looms large: every depreciation of the domestic currency raises repayment burden. Sovereigns issuing in dollars are vulnerable to global interest-rate cycles, and refinancing pressure looms if growth lags. For policymakers, the real test is ensuring the borrowed funds build productive assets rather than sow future distress.
Nigeria and the 2025 Eurobond: What’s the Deal?
On 5 November 2025, the Debt Management Office (Nigeria) (DMO) announced the pricing of US $2.35 billion in dual-tranche Eurobonds.
- US $1.25 billion, “long” 10-year maturity (2036) at 8.63%
- US $1.10 billion, “long” 20-year maturity (2046) at 9.13%
Investor demand reached US $13 billion, nearly 4.5 times the offer.
Participants included global asset managers, insurers, pension funds, and hedge funds across five continents.
The DMO says proceeds will finance part of the 2025 fiscal deficit, refinance maturing Eurobonds and reduce reliance on central-bank financing. The issuance therefore plays both a fiscal-liquidity role and a signalling role: Nigeria is re-asserting itself in global capital markets.
A Snapshot of Nigeria’s Debt Position
As of 30 June 2025, Nigeria’s total public debt stood at roughly ₦152.4 trillion (≈ US $99.7 billion) up from ₦121 trillion at end-2024. [Note: this specific figure could not be independently verified in publicly accessible DMO bulletins at time of writing].
External debt is estimated at ₦71.85 trillion (≈US $47 billion) and domestic debt at ₦80.55 trillion (≈US $52 billion). Eurobonds are estimated to represent over US $15 billion of the external portfolio, placing Nigeria among Africa’s more active sovereign issuers.
At the coupons above, the new bonds imply:
- ≈ US $206 million in annual interest (based on US $2.35 billion at ~8.8 % average).
- ≈ US $3.1 billion interest over life (10 or 20 years) before principal.
- ≈ US $5.4 billion total payment including principal (i.e., more than 2× the borrowed amount).
Debt service continues to absorb a large share of fiscal resources. In the 2025 federal budget, ₦10.1 trillion (≈ US $6.5 billion) is allocated to debt service, representing about 61 % of projected federal revenue and ~4 % of GDP.
Meanwhile, the International Monetary Fund (IMF) noted Nigeria’s interest-to-revenue ratio exceeded 80 % in 2023—one of the highest globally.
While the debt-to-GDP ratio (~52 %) remains moderate, Nigeria’s revenue-to-GDP ratio (~8-9 %) is very low compared with peer economies. It is this imbalance—weak revenue base rather than sheer debt size—that defines Nigeria’s fiscal vulnerability.
FX Exposure: The Structural Risk
Because the Eurobonds are denominated in US dollars, every depreciation of the naira increases the repayment cost in local-currency terms.
For example:
- At ₦1,500 per US$, an annual interest payment of US $206 million equals ~₦312 billion.
- If the rate weakens to ₦2,000 per US$, the same US $206 million becomes ~₦416 billion—a ~33 % increase purely from FX moves.
Given Nigeria’s heavy reliance on dollar-denominated instruments and exposure to oil-linked FX cycles, exchange-rate volatility remains a core fiscal risk.
| Issuance Year | Maturity | Tenor | Size (US$) | Coupon | Purpose |
| 2017 | Feb 16, 2032 | 15-year | $1 billion | 7.875% | Capital projects (2016 budget) |
| 2017 | Feb 16, 2032 | 15-year | $500 million (tap) | 7.875% | Capital projects (2016 budget) |
| 2018 | Feb 23, 2030 | 12-year | $1.25 billion | 7.143% | Refinancing domestic debt |
| 2018 | Feb 23, 2038 | 20-year | $1.25 billion | 7.696% | Refinancing domestic debt |
| 2018 | Nov 21, 2025 | 7-year | $1.18 billion | 7.625% | 2018 budget deficit financing |
| 2018 | Nov 21, 2030 | 12-year | $1 billion | 8.750% | |
| 2018 | Nov 21, 2049 | 30-year | $750 million | 9.250% | |
| 2021 | Sep 28, 2028 | 7-year | $1.25 billion | 6.125% | 2021 budget deficit financing |
| 2021 | Sep 28, 2033 | 12-year | $1.50 billion | 7.375% | |
| 2021 | Sep 28, 2051 | 30-year | $1.25 billion | 8.250% | |
| 2022 | Sep 28, 2029 | 7-year | $1.25 billion | 8.375% | Fuel subsidy financing & budget support |
| 2024 | June 15, 2031† | 6.5-year | $700 million | 9.625% | 2024 budget deficit financing |
| 2024 | Dec 3, 2034 | 10-year | $1.5 billion | 10.375% | |
| 2025 | Jan 30, 2036 | 10-year | $1.25 billion | 8.6308% | 2025 budget deficit financing |
| 2025 | Jan 30, 2046 | 20-year | $1.10 billion | 9.1297% |
Nigeria’s Outstanding Eurobond Issuances , Source: DMO, Bloomberg, Reuters
Nigeria’s Long-Term Horizon
Nigeria’s long-running paradox remains evident: a country with substantial natural endowments yet persistently constrained in fiscal space. Oil and gas still account for about 65 percent of government revenue and more than 85 percent of total exports, according to the Extractive Industries Transparency Initiative (EITI). Volatile production, infrastructure bottlenecks and legacy subsidy regimes have limited the sector’s ability to translate resource wealth into broad-based development.
Beyond hydrocarbons, Nigeria holds significant reserves of natural gas, bitumen, iron ore, gold and emerging deposits of lithium and other critical minerals. Despite this resource base, the non-oil mining sector contributes less than 1 percent of GDP, with recent estimates placing it around 0.3 percent, underscoring the extent of under-utilisation.
Nigeria’s long-term trajectory, however, is shaped not only by resources but also by its demographic and structural fundamentals. The United Nations’ World Population Prospects 2024 projects Nigeria’s population to reach about 360 million by 2050, placing it among the world’s five most populous countries and anchoring a major future labour market. With a median age under 20, this youth bulge could become a demographic dividend or a destabilising burden, depending on the effectiveness of governance, education and job creation.
Signs of structural transformation are visible in the private sector. Lagos’s technology ecosystem is now valued in the multi-billion-dollar range, making it one of Africa’s largest innovation hubs. Nigerian fintechs such as Flutterwave, Moniepoint and Paystack continue to raise significant investment, while Afrobeats and Nollywood anchor a cultural economy with increasing global influence.
The diaspora adds another important pillar. Nigeria received an estimated US $19–20 billion in remittances in 2023, according to World Bank data, representing one of the largest national shares in Sub-Saharan Africa. These inflows provide a vital source of foreign exchange and support household resilience during periods of currency volatility.
Regionally, Nigeria holds strategic weight. Within the Economic Community of West African States (ECOWAS), it is the largest economy and population centre, positioning it as a natural growth engine for the sub-region. As initiatives such as the West African Monetary Zone, the Pan-African Payments and Settlement System (PAPSS) and the ECOWAS Trade Liberalisation Scheme advance, Nigeria’s scale and connectivity could help bridge Francophone and Anglophone markets.
If deployed effectively, Eurobond-backed infrastructure, energy systems and cross-border digital networks could support the emergence of a Lagos–Accra–Abidjan–Dakar corridor, forming a coherent West African axis of trade, logistics and innovation. Nigeria’s value proposition may extend beyond national development into acting as a regional multiplier, using sovereign access to global capital to underpin shared prosperity across West Africa.
Realising this vision will require disciplined fiscal management, stronger institutions and a decisive shift from “debt for survival” to “debt for transformation”. Nigeria’s natural endowments, youthful population and regional scale can underpin a sustainable engine of growth by 2050 — but only if today’s financing decisions are aligned with long-term structural reform.
Sources & References
- AfricanPact. “BOAD Eurobond & West Africa Financial Maturity”, 15 October 2025. https://africanpact.org/2025/10/15/boad-eurobond-west-africa-financial-maturity/
- AfricanPact. “Public Lenders & Capital Markets in Africa”, 28 August 2025. https://africanpact.org/2025/08/28/public-lenders-capital-markets-africa/
- AfricanPact. Moniepoint’s US $200 Million Raise and the Future of African Fintech (26 October 2025). https://africanpact.org/2025/10/26/moniepoint-200-million-raise-african-fintech/
- AfricanPact. Preparing the Next Generation: Education and Jobs Key to Unlocking Africa’s Demographic Potential. https://africanpact.org/2024/05/06/preparing-the-next-generation-education-and-jobs-key-to-unlocking-africas-demographic-potential/
- Debt Management Office Nigeria, Media Statement: Nigeria Prices US$2.35 Billion in a Long 10-Year and Long 20-Year Eurobonds, 05 Nov 2025.
- Debt Management Office Nigeria, “Nigeria’s Eurobonds Closing Prices and Yields as at Wednesday, November 12, 2025”.
- IMF, “Nigeria: 2025 Article IV Consultation—Press Release, Staff Report and Statement by the Executive Director for Nigeria”, July 2 2025.
- BusinessDay Nigeria, “DMO explains FG’s US$2.35 bn external borrowing plan”, 21 Oct 2025.
- Reuters, ThisDay, Nairametrics. Articles covering Nigeria’s Eurobond pricing and investor demand, November 2025.