Business
Nigeria’s debt rises as DMO warns against unrestrained borrowing
*FG can only borrow N1.6trn local, N4.8trn external
*30% of budget should go for capital investments
Nigeria’s total external debt stock outstanding rose to $10.71843 billion as at end of December, 2015 from $9.71145 billion at the end of the corresponding period in 2014. This fact is contained in the new report released by the Debt Management Office, DMO. The increase in debt stock was $1.00698 billion or 10.37 percent above the figure at the end of December 2014. The rise is as a result of additional disbursements from 14 existing multilateral and bilateral creditors, as well as net adverse cross exchange rate movements between the different currencies in the external loan portfolio.
The Debt Management Office in the report said that the maximum amount that Nigeria can borrow in 2017 from both local and foreign sources is $22.08 billion without it violating its debt threshold. The report said that Nigeria had a borrowing space of 5.89 per cent of its GDP of $374.95 billion which will take its debt limit Nigeria has set for itself, a threshold of 19.39 percent of the nation’s total public debt-to-GDP ratio.
The DMO report said “for the fiscal year 2017, the maximum amount that could be borrowed is $22.08 billion, and it is proposed to be obtained from both the domestic and external sources as follows: new domestic borrowing $5.52 billion; equivalent of about
N1.600.trillion; and, new external borrowing of $16.56 billion equivalent of about
N4.800 trillion.
“It is worthy to note that these are recommended maximum amounts that could be borrowed, taking into account the absorptive capacity of the domestic debt market and the options available in the external market. It is expected that such external borrowings, which would be long-term, minimum 15 years, would be strategically deployed to fund priority infrastructure projects that would boost output, and put the economy on the path of sustainable recovery and growth. It is further expected that the long maturity profile of such loans would enable the economy to be sufficiently diversified for increased export earnings for ease of debt service payments”.
The DMO report said “the key policy recommendations of the 2016 Debt Sustainability Report DSA, exercise are as follows: The end-period NPV of Total Public Debt-to-GDP ratio for 2016 for FGN is projected at 13.5 percent. Given the Country-Specific threshold of 19.39 percent for NPV of Total Public Debt-to-GDP ratio up to 2017, the borrowing space available is 5.89 per cent of the estimated GDP of $374.95 billion for 2017. To this end, the maximum amount that could be borrowed, domestic and external, by the FGN in 2017 without violating the country-specific threshold will be $22.08 billion (i.e. 5.89 percent of $374.95 billion.
“The Debt Management Strategy, 2016-2019, provides for the rebalancing of the debt portfolio from its composition of 84:16 as at end-December, 2015, to an optimal composition of 60:40 by end-December, 2019 for domestic to external debts, respectively. It supports the use of more external finance for funding capital projects, in line with the focus of the present Administration on speeding up infrastructural development in the country, by substituting the relatively expensive domestic borrowing in favour of cheaper external financing.
“This policy stance has been reinforced by the recent deterioration in macroeconomic variables, particularly with respect to the rising cost of domestic borrowing. Hence, the shift of emphasis to external borrowing would help to reduce debt service burden in the short to medium-term and further create more borrowing space for the private sector in the domestic market.
“There is an urgent need for the Government to formulate an Economic Blueprint or Road-Map for the medium-term. Aside from addressing the current challenges, it would go a long way to engender confidence in both local and international investors on the way forward. This has become very imperative, given that investor-perception of a country’s outlook is critical to its economic recovery. It is advisable that the Federal Government sustains the on-going reforms and initiatives in the various key sectors of the economy, including: agriculture, education, housing, power, and transportation, as this would foster the needed inclusive economic growth and development. In view of the continued deterioration in government’s revenue, occasioned by the drastic fall in the price of oil, government should reinforce its initiatives aimed at diversifying the productive base of the economy and, thus, improve the non-oil revenue receipts. Accordingly, concrete and urgent steps should be taken to broaden the tax base and improve efficiency in tax administration and collection.
“Given the country’s huge infrastructural needs, the Government is encouraged to sustain the policy of allocating a minimum of 30 percent of Federal Government’s budget to capital investments, as well as ensuring judicious utilization of such funds for infrastructure development. In view of the adverse effect on the economy of the recurring delays in budget formulation and passage, there is the need for the Government to ensure strict adherence to the annual budget calendar, so as to facilitate growth recovery, reduce fiscal slippages and delays in budget implementation.
“The passage of the Petroleum Industry Bill (PIB) by the National Assembly is long overdue and should be given speedy attention by the authorities. Its passage is expected to liberalise the oil and gas sector, and thus, attract more investments into the sector, which will have positive multiplier effect on the economy. Given that in the short to medium-term, oil would still remains a key revenue earner of the nation, the Federal Government is encouraged to continue on its efforts to curtail crude oil production disruptions in the oil producing areas.
“In view of the country’s huge infrastructure requirements, the Federal Government is enjoined to creatively explore other alternative and viable sources of financing critical infrastructure development outside the routine budgetary process. These may include the setting up of an Infrastructure Development Fund, the issuance of Infrastructure-tied Bonds, as well as encouragement for the private sector to participate in funding viable infrastructural projects through Public-Private-Partnership arrangements.
“As part of the initiatives for boosting revenue, the Federal Government is encouraged to fast-track the process of liberalising the exploration of the solid minerals deposits across the country. This is to make the sector much more attractive and competitive, and further expand the non-oil revenue base. As part of government’s commitment to encouraging private sector participation in the development of the economy, the demand for FGN Guarantees may likely increase. In order to instill discipline and discourage frivolous requests that may unduly expose the Federal Government, it is also recommended that the issuance of FGN Guarantees to the private sector should attract appropriate fees, and should be within an established framework.
“Given the current dwindling resources accruing to all tiers of Government, resulting from the various shocks in the economy, State Governments need to be encouraged to implement effective fiscal reforms aimed at improving their internally generated revenues, so as to curtail the over-dependence on federal allocations and Federal Government bail-out.
“The DMO should be encouraged to sustain its on-going capacity building initiatives for the sub-nationals, so as to upscale their technical competence and skills in debt management, and bring them to the level where the staff of the Debt Management. Departments would be able to conduct DSAs and Medium-Term Debt Strategy,(MTDS) for their States. This will further help the officials to effectively advise their respective State Governments on issues relating to public debt management.”
National Bureau of Statistics has said that Nigeria’s Company Income Tax rose sharply in the second quarter of 2025, hitting N2.78 trillion.
The figure represents a significant 40.27 per cent increase compared to the N1.98 trillion recorded in the first quarter of the year, reflecting both improved tax compliance and stronger corporate performance across key economic sectors.
The NBS report said that domestic company income tax payments accounted for the bulk of the revenue, contributing N2.31 trillion, while offshore collections stood at N469.36 billion during the period under review.
According to the NBS, the financial and insurance sector recorded the highest quarter-on-quarter growth, rising by an astonishing 772.29 per cent, driven by improved profitability among banks, fintechs, and insurance firms following robust half-year earnings.
This, according to NBS, was followed by wholesale and retail trade, as well as motor vehicle repair activities, which grew by 538.38%.
Activities of households as employers also surged by 526.79%, although their overall contribution to total company income tax remained negligible.
On the flip side, some sectors experienced sharp declines in company income tax remittances.
Activities of extraterritorial organizations and bodies dropped by –45.01%, while education, public administration, defence, and compulsory social security recorded declines of –26.61% and –18.17% respectively.
The contraction in these sectors, particularly education and public administration, highlights persistent structural and fiscal challenges confronting government-funded institutions.
In terms of contribution to total tax revenue, financial and insurance activities led with a dominant 44.13%, reflecting the sector’s continuing expansion and strong capital flows.
Manufacturing followed with 15.57%, bolstered by increased production output and improved supply chain activity.
Mining and quarrying ranked third, contributing 9.18%, supported by higher commodity prices and renewed interest in solid mineral development.
At the bottom of the contribution chart were activities of households as employers, which accounted for just 0.01%, as well as activities of extraterritorial organizations and bodies, and water supply, sewerage, waste management, and remediation services, each contributing 0.04%. Despite economic headwinds, year-on-year company income tax collection still rose by 12.66% when compared to Q2 2024, underscoring moderate but steady improvement in government revenue mobilisation.
Company income tax collection in the same period of 2024 rose by 150.83 per cent N2.47 trillion. In the first three months of the year, company income tax collection stood at N984.61 billion. According to the report, local payments in the period under review amounted to N1.35 trillion, while foreign CIT payments contributed N1.12 trillion. On a quarter-on-quarter basis, the agriculture, forestry, and fishing sectors exhibited the highest growth rate at 474.50%, followed by financial and insurance activities at 429.76%, and manufacturing at 414.15%.
Lagos State government has reaffirmed its unwavering commitment to supporting micro, small, and medium enterprises (MSMEs) across the state through visibility, capacity building, and market access. Commissioner for Commerce, Cooperatives, Trade, and Investment, Folashade Ambrose-Medebem, made the pledge on Sunday at the closing ceremony of the 2025 Lagos International Trade Fair (LITF). The 38th edition of the event, organised by the Lagos Chamber of Commerce and Industry (LCCI), had its theme as “Connecting Business, Creating Value.”
Ms Ambrose-Medebem said every entrepreneur, regardless of scale, deserves an enabling environment to thrive and contribute meaningfully to the state’s economic prosperity. She said the state, through strategic investments in infrastructure, institutional reforms, and continuous engagement with the private sector, was building a Lagos that worked for business. The commissioner added that the state would continue to foster innovation, competitiveness, and sustainability.
“As a government, we remain steadfast in our commitment to making Lagos the preferred destination for commerce and enterprise. This fair has once again demonstrated the power of connection: connection between producers and consumers, investors and innovators, the government and the private sector, and local entrepreneurs and global brands. Every handshake, every conversation, every business card exchanged here is a building block toward the future we are creating, a future of prosperity that leaves no one behind,” she said.
The commissioner urged businesses to continue to connect, collaborate, and create value, saying, “In Lagos, we do not just trade goods; we trade ideas, build futures, and transform lives. “Together, let us continue to make Lagos not just a place of commerce, but a symbol of progress, innovation, and endless opportunity.” Gabriel Idahosa, president of LCCI, urged governments at all levels to continue addressing the issues of creating an enabling environment in the country.Mr Idahosa said focus should be on infrastructure, security, and implementing the right policies to address the key drivers of high inflation.
This, he said, was needed to fully harness the vast enterprising resources of domestic and foreign investors for the diversification of our economy and the welfare of our people. He pledged the commitment of the organised private sector to stand solidly behind the state in its quest to actualise its innovative initiatives on all fronts. NAN
Jumia Technologies AG posts a $17.7 million loss before income tax in the third quarter of 2025, down 1% year-on-year from $17.8 million in the third quarter of 2024. The road to profitability has remained long as ecommerce continues to face uncertainties, including widening competition with rivals in the same industry. The e-commerce company revenue came in at $45.6 million compared to $36.4 million in the third quarter of 2024, representing a 25% year-over-year surge in the period. The company reported gross merchandise value of $197.2 million compared to $162.9 million in the third quarter of 2024, up 21% year-over-year. Excluding South Africa and Tunisia, physical goods GMV grew 26% year-over-year, Jumia revealed in the unaudited financials.
Jumia said in its report that the GMV growth was driven by supply and strong marketing execution, partially offset by lower corporate sales in Egypt. Excluding corporate sales, GMV in reported currency grew 37% year-over-year. Nigeria’s momentum accelerated, with order growth up 30% and GMV up 43% year-over-year, Jumia said. The e-commerce giant’s operating loss reduced by 13% year-over-year to $17.4 million compared to $20.1 million in the third quarter of 2024. The company’s adjusted earnings before interest tax depreciation and amortisation loss dropped by 17% to $14.0 million compared to $17.0 million in the third quarter of 2024.
Jumia reported a loss before income tax of $17.7 million, a slight reduction of 1% compared to $17.8 million in the third quarter of 2024. Liquidity printed at $82.5 million, a decrease of $15.8 million in the third quarter of 2025, compared to an increase of $71.8 million in the third quarter of 2024, which included the net proceeds from the August 2024 At-the-Market (ATM) offering, and a decrease of $12.4 million in the second quarter of 2025.
Its net cash flow used in operating activities settled at $12.4 million compared to net cash flow used in operating activities of $26.8 million in the third quarter of 2024 and $12.7 million used in the second quarter of 2025. The result includes a positive working capital contribution of $0.4 million.
Jumia reported that customers’ orders grew 34% year-over-year, driven by strong execution, enhanced product assortment, and healthy consumer demand across key categories. It said quarterly active customers ordering physical goods grew by 23% year-over-year, highlighting continued engagement and customer loyalty. As of September 30, 2025, the Company’s liquidity position was $82.5 million, comprised of $81.5 million in cash and cash equivalents and $1.0 million in term deposits and other financial assets, it said in the report Jumia’s liquidity position decreased by $15.8 million in the third quarter of 2025, compared to an increase of $71.8 million in the third quarter of 2024, which included net proceeds from the August 2024 At-the-Market (ATM) offering, and a decrease of $12.4 million in the second quarter of 2025.
Net cash used in operating activities was $12.4 million in the third quarter of 2025, compared to a net cash used of $26.8 million in the third quarter of 2024 and $12.7 million used in the second quarter of 2025. The result includes a positive working capital contribution of $0.4 million in the third quarter of 2025, compared to a negative working capital contribution of $9.1 million in the third quarter of 2024, primarily reflecting improvements in operating performance.
In addition, the Company reported $1.4 million in capital expenditures in the third quarter of 2025, compared to $0.9 million in the third quarter of 2024, primarily reflecting investments in infrastructure and facility enhancements to support business growth. “This quarter marks a significant acceleration in customer demand and order growth, driven by strong execution across our markets and growing consumer trust in the Jumia brand. We believe Jumia has reached an inflection point as our compelling value proposition, and improved operational discipline position us for sustainable, profitable growth.
“We continue to strengthen our cost structure and sharpen operational discipline, reinforcing our path toward profitability. Our focus remains on execution and customer engagement as we build a more efficient business.
“We believe that we are on track to reach breakeven on a Loss before Income tax basis in Q4 2026 and achieve full-year profitability in 2027, positioning Jumia for long-term growth and value creation.”
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