Nigeria holds 16% as six countries control 80% of Africa’s corporate debt

Nigeria is one of six African countries that accounted for 80% of the continent’s outstanding corporate debt at the end of 2025, according to the OECD Africa Capital Markets Report 2026. The report, released on Friday, shows corporate debt activity is concentrated in a small number of African economies despite efforts to deepen capital markets across the region.

South Africa leads, Egypt slips

South Africa had the largest share at approximately 31%, followed by Nigeria at 16% and Egypt at 13%. Mauritius accounted for 9%, Mozambique 6% and Morocco 5%, bringing the combined share of the six countries to 80%.

South Africa has maintained its position as the region’s largest corporate debt market over the past 15 years, with outstanding corporate debt of $63 billion at the end of 2025. Egypt has lost relative share. Companies headquartered in Egypt accounted for 30% of Africa’s corporate debt in 2010, slightly below South Africa’s share, but that proportion had fallen by more than half by 2025. The OECD attributed much of the decline to a contraction in Egypt’s corporate debt stock rather than rapid expansion in other markets.

Loans dominate, bonds remain thin

Syndicated loans remain the dominant form of market-based corporate debt financing in most African countries. Corporate bonds play a more significant role in Morocco, Gabon, Sudan and Togo. The OECD noted that outside Morocco, this largely reflects financial-sector issuance and underdeveloped syndicated loan markets rather than deep corporate bond markets.

The organisation said African economies have shown some resilience amid challenging external and macro-financial conditions, supported partly by market reforms, greater participation by domestic investors and improvements in market infrastructure. But Africa accounted for only 0.4% of global market capitalisation in 2024. Shallow domestic markets, limited liquidity and continued dependence on bank lending and external official financing remain major constraints.

Africa’s $4.4 trillion domestic capital pool

The OECD estimated that Africa’s domestic capital pools exceed $4.4 trillion. These include assets held by banks, public development banks, sovereign wealth funds, pension funds, insurance companies, other financial institutions and central banks.

Mobilising more of these resources through domestic and regional capital markets could provide long-term financing for productive investment while strengthening financial resilience, particularly as access to external financing remains constrained. The pools account for around 0.9% of global financial assets. “Overall, capital markets remain underutilised as a source of long-term finance, particularly when compared to other emerging-market economies, limiting their contribution to economic growth and resilience,” the OECD said.

Nigeria still leans on bank loans

Nigeria’s corporate debt profile reflects the report’s concerns about reliance on bank financing, despite growth in commercial papers and corporate bonds. A Nairametrics review of 19 of the largest companies in the NGX 30 found they had combined debt of N6.25 trillion as of June 2026. Bank loans and other direct borrowing facilities accounted for about N4.64 trillion, or 74.2% of the total.

Companies have increasingly turned to commercial papers. Nairametrics Research reported that Nigerian businesses raised approximately N1.61 trillion through commercial papers in 2025, a 40% increase from N1.15 trillion in 2024. The trend continued into 2026, with about 24 companies issuing commercial papers by May. Outstanding corporate bonds reached approximately N2.30 trillion by June 2026, while outstanding commercial papers stood at N465.34 billion, according to FMDQ data.

The funding picture comes amid changing liquidity conditions in the banking system. The Central Bank of Nigeria recorded a net liquidity injection of approximately N3.20 trillion in October 2026, as maturing securities worth N10.69 trillion exceeded the N7.49 trillion raised through Open Market Operations and Nigerian Treasury Bills.

For Nigerian businesses, the data points to a funding mix that remains bank-heavy even as commercial paper use rises. Liquidity conditions and borrowing costs will stay central as firms test bonds and short-term instruments.