The Central Bank of Nigeria (CBN) has disclosed that the Federal Government’s debt servicing obligations for January 2025 stood at N696.27 billion, while total retained revenue amounted to only N483.47 billion.
This indicates that debt service consumed about 144 per cent of all government earnings for the period.
The CBN disclosed this in its January 2025 Monthly Economic Report.
Despite slight improvements in some revenue categories, the retained earnings were grossly inadequate to cover obligatory debt repayments, exposing the government’s continued reliance on borrowing to meet basic obligations.
The report further showed that retained revenue in January 2025 only recorded a marginal 0.89 per cent increase when compared with the N479.21 billion generated in the corresponding month of 2024.
“FGN retained revenue declined in the review period, owing largely to lower receipts from Federal Government Independent Revenue and FGN’s share of exchange gain.
“At N0.48tn, provisional FGN retained revenue was 69.19 and 70.40 per cent below the levels recorded in the preceding period and monthly target, respectively,” the report read.
The retained revenue components showed that the Federation Account contributed N167.69 billion, while the VAT Pool Account delivered N90.73 billion.
Independent Revenue, a key component expected to reflect the efficiency of Ministries, Departments, and Agencies, plummeted to N32.28 billion, representing a staggering 66.14 per cent year-on-year decline from N95.34 billion recorded in January 2024.
Exchange gains, however, grew by 35.6 per cent, rising from N138.67 billion in January 2024 to N188.09 billion in January 2025.
Revenues from Excess Crude oil sales and the ‘Others’ category contributed nothing to January’s retained revenue despite budgetary projections, further deepening concerns over the robustness of Nigeria’s revenue generation framework.
A month-on-month comparison showed that in December 2024, retained revenue stood at N1.57 trillion, indicating a decline of 69.19 per cent in government earnings within a single month.
In December 2024, debt servicing accounted for only 44.37 per cent of total revenue and by January 2025, the figure rose to 144 per cent.
In contrast, debt servicing obligations remained relatively stable between the months.
Debt service expenditure of N696.27 billion in January 2025 was7.88 per cent lower than N755.86 billion recorded in January 2024.
However, the absence of substantial revenue growth meant that the debt-to-revenue ratio worsened sharply, underlining the government’s increasing inability to meet obligations without resorting to fresh borrowing.
