Lagos State has emerged as the most indebted state in Nigeria, according to the National Bureau of Statistics (NBS). As of the fourth quarter (Q4) of 2025, Lagos owes a total of N1.22 trillion in domestic debt and $1.17 billion in external debt.
NBS Report Highlights
In its Q4 2025 domestic and external debt report released on Monday, April 27, the NBS stated that Nigeria's total debt stock—comprising both domestic and external debt—rose from N153.29 trillion ($103.94 billion) in Q3 2025 to N159.28 trillion ($110.97 billion) in Q4 2025. This represents an increase of 3.90 percent on a quarter-on-quarter basis.
The report further revealed that total external debt stood at N74.43 trillion, while total domestic debt was N84.85 trillion in Q4 2025. The share of external debt (in naira value) to total public debt was 46.73 percent, while domestic debt accounted for 53.27 percent.
State Debt Breakdown
Among subnationals, Lagos recorded the highest domestic debt in Q4 2025 at N1.22 trillion, followed by Rivers with N378.81 billion. Jigawa recorded the lowest domestic debt at N1.60 billion, followed by Ondo with N8.42 billion. In terms of external debt, Lagos also topped the list with $1.17 billion, followed by Kaduna with $684.29 million. The Federal Capital Territory (FCT) had the lowest external debt at $26.80 million, followed by Zamfara with $41.93 million.
Other heavily indebted states include Bauchi, with $220.57 million in external debt and N156.05 billion in domestic debt; Delta, with $63.42 million external and N248.83 billion domestic; and Enugu, with $99.88 million external and N157.60 billion domestic.
Concerns Over Rising Debt Burden
The escalating debt burden has raised concerns among Nigerians, as debt service obligations exert high pressure on the country's revenue. Earlier this month, the World Bank warned that Nigeria's rising debt service costs are reducing its capacity to fund critical infrastructure. The bank specifically noted a sharp drop in capital spending to 1.0 percent of GDP from 1.3 percent in 2024, as debt servicing crowds out investment.
The International Debt Report 2025 advised Nigeria and other Sub-Saharan African countries to pursue export diversification and fiscal reforms to address their rising debt challenges. It highlighted that debt levels and servicing burdens continue to rise even as growth remains subdued, underscoring persistent fiscal stress.
