Nigeria’s debt-to-GDP ratio has declined to 32.3 per cent in 2026 from 38 per cent in 2023, marking the first sustained fall in the ratio in more than a decade.
Despite the decline, the country’s total debt stock has risen above N159 trillion.
The Nigeria Revenue Service (NRS), in an internal report, said the development indicated that the Nigerian economy was growing faster than the rate at which government debt was accumulating.
The agency said the economy had moved from a period of severe macroeconomic challenges towards a more stable and resilient position.
The NRS attributed the improvement to economic reforms introduced by President Bola Ahmed Tinubu under the Renewed Hope Agenda, describing the measures as difficult but necessary.
According to the report, the debt-to-GDP ratio declined from 38 per cent in 2023 to 35.5 per cent in 2025 before falling further to 32.3 per cent in 2026.
The decline means that although Nigeria’s debt has increased in naira terms, economic output has expanded at a faster pace, reducing the relative size of the debt burden.
The report also noted an improvement in debt servicing, with debt service as a proportion of government revenue projected to fall from 68 per cent to 53 per cent, citing International Monetary Fund figures.
The NRS identified four major economic distortions inherited by the Tinubu administration, including the fuel subsidy regime, an opaque foreign exchange system, low oil production and a tax system that generated revenue below its potential.
Nigeria’s external reserves also rose significantly, reaching $51.9 billion as of July 2026, according to the report. This represents a more than 12-fold increase from the $3.99 billion recorded in 2023 and the highest level in 17 years.
The country’s balance of payments position also improved from a deficit of $3.34 billion to a surplus of $2.38 billion in the first quarter of 2026.
The Nigerian Exchange equally recorded strong growth during the period, with market capitalisation rising from N30.36 trillion in 2023 to N161 trillion in 2026.
The NRS linked the stock market rally to improved investor confidence, bank recapitalisation and increased participation by Nigerian institutions.
Tax revenue also more than doubled, increasing from N12.3 trillion in 2023 to N27.1 trillion as of July 2026.
The agency attributed the rise to the digitisation of tax collection, the implementation of four new tax reform laws, restructuring of the revenue service and measures aimed at closing tax evasion loopholes.
Oil production also increased from between 1.2 million and 1.3 million barrels per day in 2023 to 1.73 million barrels per day by July 2026.
The figure represents 104 per cent of Nigeria’s quota under the Organisation of the Petroleum Exporting Countries (OPEC).
The NRS further stated that Nigeria had become a net exporter of petroleum products for the first time in decades, attributing the development partly to the naira-for-crude arrangement involving the government, Dangote Refinery and other local refineries.
Petroleum product exports excluding crude oil increased by 51 per cent year-on-year to N6.78 trillion in the first quarter of 2026.
The government’s compressed natural gas (CNG) programme has also expanded significantly. More than 100,000 vehicles had been converted to CNG by 2026, with the programme attracting more than $2 billion in investment and creating over 10,000 jobs.
According to the report, CNG could reduce vehicle running costs by between 40 and 60 per cent compared with petrol, with some commercial drivers reportedly seeing monthly fuel expenses fall from about N50,000 to N18,000.
Nigeria’s trade position also strengthened, with the country recording a N7.55 trillion trade surplus in the first quarter of 2026, compared with a marginal N44.7 billion surplus previously recorded.
Capital importation increased from $3.9 billion in 2023 to $23.22 billion in 2025, while $10.37 billion entered the country in the first quarter of 2026 alone.
The report said foreign portfolio investment remained strong, while foreign direct investment also showed signs of improvement.
On agriculture, the NRS highlighted government interventions following the declaration of a state of emergency on food security in July 2023.
The measures included the release of strategic grain reserves, establishment of a N100 billion National Agricultural Development Fund, fertiliser distribution and agricultural mechanisation initiatives.
Federal budget allocation to agriculture rose from N228.4 billion in 2023 to N826.5 billion in the 2025 budget.
The report, citing the Ministry of Agriculture, said food prices had declined by about 50 per cent by March 2026, although it acknowledged that agricultural reforms would require several planting seasons before their full impact could be felt.
The NRS also pointed to improvements in household welfare, noting that the national minimum wage doubled between 2023 and 2026.
It added that the number of Nigerian children out of school declined from 20 million to 18.3 million, citing estimates by UNICEF.
Overall, the NRS said the figures showed that Nigeria had moved beyond its most difficult economic period and was now on a stronger footing.
However, the agency acknowledged that some areas, particularly agriculture, would require more time before the full benefits of the reforms became evident.
