The Debt Management Office (DMO) has disclosed that Nigeria’s 36 states and the Federal Capital Territory (FCT) had accumulated a combined debt of N4.002 trillion as of September 30, 2025.
The latest figures, released by the DMO, show that subnational debt accounts for just 2.61 per cent of Nigeria’s total public debt of N153.29 trillion.
Data from the office indicate that the debt burden is highly concentrated. Ten states alone account for 67 per cent of the total subnational debt, amounting to N2.68 trillion.
Lagos State leads the pack, owing N1.045 trillion, which represents about 26 per cent of the total debt of all states and the FCT. Rivers State follows with N381.205 billion, while Delta State is owed N247.171 billion.
Other states in the top five include Enugu (N194.715 billion), Ogun (N168.093 billion), and Bauchi (N158.197 billion). Niger State, Cross River, Benue, and Akwa Ibom round out the top ten, with debts ranging from N143.469 billion to N95.506 billion.
Analysts say the figures highlight the growing fiscal pressure on state governments, many of which rely heavily on borrowing to plug infrastructure gaps and offset declining oil revenues.
While the Federal Government continues to shoulder the bulk of Nigeria’s public debt, subnational borrowing has raised concerns over rising debt servicing costs, which may crowd out essential spending on health, education, and social services.
Experts warn that unchecked borrowing by states could escalate national debt risks, stressing the need for prudent debt management, improved internally generated revenue, and stricter adherence to borrowing limits.
The concentration of debt in urban and oil-rich states, particularly Lagos, has reignited discussions on fiscal federalism and the need for greater revenue autonomy at the subnational level.
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