Imo, Akwa Ibom, Ogun lead domestic debt cuts as external liabilities climb

Imo, Akwa Ibom and Ogun recorded the largest domestic debt reductions among Nigerian states between Q2 2023 and Q2 2026, according to National Bureau of Statistics data covering the 36 states and the Federal Capital Territory. Ten states made significant domestic debt cuts. External debt rose in nine of the 10, with Bayelsa the only state that reduced both domestic and external debt.

Top three cuts

Imo cut domestic debt from N220.84 billion in Q2 2023 to N79.50 billion in Q2 2026, a decline of N141.34 billion or about 64%. Its external debt rose from $77.81 million in June 2023 to $109.20 million in June 2026, up about $31.38 million.

Akwa Ibom reduced domestic debt from N199.58 billion to N81.53 billion, a drop of N118.05 billion or 59.1%. External debt increased from $43.54 million to $81.84 million, up about $38.30 million.

Ogun cut domestic debt from N293.20 billion to N189.05 billion, a reduction of N104.15 billion. Its external debt rose from $111.62 million to $225.12 million, an increase of about $113.50 million.

Other states on the list

Plateau reduced domestic debt from N157.62 billion to N59.37 billion, a cut of N98.24 billion. External debt rose from $31.42 million to $141.17 million, up about $109.75 million.

Oyo lowered domestic debt from N162.40 billion to N66.40 billion, a reduction of N96 billion. External debt increased from $63.99 million to $108.61 million, up about $44.62 million.

Abia cut domestic debt from N142.47 billion to N48.63 billion, a decline of N93.85 billion. External debt rose from $92.33 million to $133.55 million, up about $41.22 million.

Bayelsa reduced domestic debt from N134.51 billion to N43.49 billion, a cut of N91.02 billion. It also reduced external debt from $59.80 million to $54.29 million, down about $5.51 million. It was the only state among the 10 to record reductions in both domestic and external debt.

Benue cut domestic debt from N186.94 billion to N112.32 billion, a decline of N74.62 billion. External debt rose from $29.30 million to $71.15 million, up about $41.85 million.

Cross River lowered domestic debt from N204.05 billion to N130.01 billion, a reduction of N74.04 billion. External debt rose from $153.17 million to $223.35 million, up about $70.18 million.

Kano cut domestic debt from N122.36 billion to N51.17 billion, a reduction of N71.19 billion. External debt increased from $101.32 million to $239.05 million, up about $137.73 million.

Debt service burden

The federal government spent N8.93 trillion on debt servicing in the first nine months of the year, equivalent to about $6.2 billion. That was 61% of the N14.55 trillion in revenue recorded in the period. Debt servicing stood at N2.26 trillion in the first quarter, rose to N3.77 trillion in the second quarter and reached N2.89 trillion in the third quarter.

The data show that lower domestic borrowing by states has not removed external obligations. For Nigerian businesses and consumers, state finances remain exposed to dollar-denominated debt even where local debt stock is falling.