Nigeria is spending almost five times more of its national revenue on servicing external debts than it spends on healthcare and education combined, according to a new report by ActionAid International and ActionAid Nigeria.
The report has reignited debate over the country’s rising debt burden and the impact of International Monetary Fund-backed economic policies on public welfare.
Released on Tuesday, the report revealed that Nigeria allocates 20.1 per cent of its national revenue to external debt servicing, compared with 4.06 per cent for healthcare and 4.40 per cent for education.
ActionAid said the figures highlight the growing pressure debt repayments are placing on government finances, leaving limited resources for essential services that directly affect citizens.
According to the organisation, debt servicing has become one of the biggest obstacles preventing many developing countries from increasing spending on public services.
The report accused the IMF of treating debt repayment as a fixed obligation while expecting governments to fund healthcare, education and social protection with whatever resources remain.
ActionAid also criticised the IMF’s long-standing support for fuel subsidy removal in Nigeria, arguing that measures introduced to cushion vulnerable households were insufficient and failed to keep pace with rising living costs.
The organisation said millions of Nigerians continue to face economic hardship linked to inflation, higher transportation costs and reduced purchasing power.
The report further highlighted concerns over Nigeria’s public-sector wage bill, which it said has remained at 1.9 per cent of GDP for six consecutive years — far below regional and global averages.
ActionAid argued that the spending cap has negatively affected sectors such as education and healthcare by limiting government investment in teachers, nurses and doctors.
Speaking on the findings, ActionAid Nigeria Country Director, Andrew Mamedu, said the IMF’s policy recommendations reflect a continuation of old approaches despite claims of institutional reform.
“For six years running, the IMF has looked at a wage bill that funds Nigeria’s teachers, nurses and doctors at less than a quarter of the regional average and found nothing to recommend beyond keeping it frozen,” he said.
The report also criticised recommendations for higher tax mobilisation, including proposals to increase VAT and expand excise duties, arguing that such measures place a disproportionate burden on low-income households.
The publication comes at a time when concerns are mounting over Nigeria’s debt-service obligations. Recent IMF projections indicate that more than half of federal government revenue could be spent on debt servicing in 2026.
Although the IMF maintains that Nigeria’s debt remains sustainable, it has acknowledged that poverty and food insecurity remain major challenges despite recent improvements in macroeconomic stability.
Analysts say the latest findings are likely to strengthen calls for a reassessment of Nigeria’s debt management strategy and greater investment in social sectors as the country seeks to balance fiscal stability with human development priorities.
