Federal Government revenue rose by 72 per cent to ₦6.2 trillion in the first half of 2026, from ₦3.6 trillion in the corresponding period of 2025, while interest payments on loans increased at a slower rate of 38 per cent, the Minister of Finance and Coordinating Minister of the Economy, Prof. Taiwo Oyedele, has said.
Oyedele, who disclosed the figures in a statement shared on his verified X account on Sunday, said the development reflected improvements arising from ongoing fiscal reforms, rather than evidence of worsening fiscal distress.
He was responding to public commentary suggesting that the Federal Government spent 124 per cent of its revenue on interest payments in the first half of 2026, citing the World Bank’s October 2026 Nigeria Development Update (NDU).
In a statement titled, “Setting the Record Straight: Interest Payments and Revenue in H1 2026,” the minister argued that the interpretation was misleading because it compared debt-service obligations covering different levels of government against an incomplete federal revenue base.
According to him, the interest payment figure includes debt serviced by the Federal Government on behalf of other tiers of government, including external loans contracted by states.
Comparing such obligations exclusively with federal revenue, he explained, produces a distorted picture because the debt and revenue figures must cover the same level of government for the resulting ratio to be meaningful.
Oyedele also faulted the revenue figure used in the analysis, saying it excluded independent revenue already earned by government agencies and enterprises but not yet remitted to the Treasury.
He added that government revenue typically rises in the second half of the year because of the statutory timing of certain tax payments, making a half-year comparison an incomplete measure of the government’s overall fiscal position.
The minister noted that the interest-to-revenue ratio stood at 156 per cent in the first half of 2025, yet the full-year 2025 debt-service-to-revenue ratio fell below 60 per cent, compared with 97 per cent before the current administration’s reforms.
He cited the figures as evidence that the reforms were improving the government’s revenue position and capacity to meet its debt obligations.
Providing a year-on-year comparison, Oyedele said federal revenue increased from ₦3.6 trillion in the first half of 2025 to ₦6.2 trillion in the corresponding period of 2026, while interest payments rose from ₦5.6 trillion to ₦7.7 trillion.
The difference between revenue and interest payments consequently narrowed from ₦2 trillion to ₦1.5 trillion, while the interest-to-revenue ratio declined by 32 percentage points, from 156 per cent to 124 per cent.
He maintained that the figures demonstrated that revenue was growing considerably faster than interest costs, pointing to the impact of the administration’s fiscal reforms.
Oyedele further argued that a six-month snapshot should not be used as the sole basis for determining Nigeria’s debt sustainability, which he said should be assessed using full-year figures.
He pointed to the World Bank’s projection that Nigeria’s full-year 2026 debt service, covering both interest and principal repayments, would amount to 46 per cent of revenue.
According to him, the projected full-year ratio provides a more appropriate basis for assessing the country’s debt-service burden than the half-year interest-to-revenue ratio.
The minister also sought to allay concerns over the legality and transparency of federal borrowing, insisting that every loan contracted by the Federal Government had the requisite approval of the National Assembly.
He said all federal borrowing fell within the limits authorised under the 2026 Appropriation Act and the approved borrowing plan.
Oyedele added that borrowing activities complied with the Fiscal Responsibility Act 2007 and the Debt Management Office (Establishment) Act 2003.
He said details of the government’s borrowing were also published regularly by the Debt Management Office, reinforcing the administration’s commitment to fiscal accountability and transparency.
