When FX Blew Up Nigeria’s Debt Numbers

The “FX blew up Nigeria’s debt numbers” refers to the sharp depreciation of the Nigerian naira against major foreign currencies, which caused the country’s external debt burden to swell on paper. Nigeria’s sovereign debt is largely denominated in dollars, euros or pounds; when the naira loses value, each unit of foreign‑currency debt requires more naira to service or refinance. The 2022‑2023 devaluation—driven by falling oil revenues, high inflation and tight foreign‑exchange controls—more than doubled the naira‑equivalent of existing dollar‑denominated bonds and loans. Consequently, debt‑to‑GDP ratios and debt‑service costs rose sharply, even though the underlying foreign‑currency obligations did not change,... Views Nigeria