Nigeria’s net foreign liability position rose by $7.5bn to $90.2bn in 2025, as foreign investors’ claims on Nigerian assets increased faster than the country’s investments abroad, according to data from the Central Bank of Nigeria.
The rise in foreign liability position is an indication of stronger foreign portfolio and direct investment liabilities, partly offset by growth in Nigeria’s reserve assets and higher holdings of foreign investments by Nigerian residents.
The CBN’s International Investment Position report showed that Nigeria’s net financial liabilities rose from $82.7bn in 2024 to $90.2bn in 2025. The position was based on external assets of $125.6bn, representing investments held abroad by Nigerian residents, and foreign liabilities of $215.8bn, representing foreign investments in Nigerian assets.
Unlike the Balance of Payments, which measures the flow of trade and capital transactions during a period, the IIP captures the stock of external financial assets and liabilities at a particular point in time.
The increase in Nigeria’s external liabilities was largely driven by a $10.1bn increase in portfolio investment liabilities, mainly from foreign investments in government debt instruments such as OMO bills. Investors were attracted by high yields arising from Nigeria’s elevated interest‑rate environment.
Direct investment liabilities also increased by $6.7bn year‑on‑year, reflecting stronger foreign ownership positions in Nigerian companies and subsidiaries, a development that signals continued investor interest in selected sectors of the economy.
On the asset side, Nigeria’s reserve assets jumped by $5.6bn, strengthening external buffers and improving the country’s capacity to respond to external shocks. Additional growth in Nigerians’ direct, portfolio and other foreign assets contributed another $3.3bn.
However, the widening liability position highlights Nigeria’s growing dependence on foreign capital inflows and the need to improve the quality of external financing. While foreign investment has supported foreign exchange liquidity and helped ease pressure on the naira, a large concentration of inflows in short‑term portfolio investments could expose the economy to sudden capital outflows if global interest rates rise or investor confidence weakens.
The higher foreign debt securities holdings also mean that Nigeria may face increased pressure on foreign exchange resources when investors repatriate interest payments or exit their positions.
Economists argue that the country’s external sustainability will depend on attracting more long‑term foreign direct investment, expanding non‑oil export earnings and maintaining stronger reserve accumulation.
A sustained improvement in crude oil prices could provide additional support through higher export revenues and foreign exchange inflows. However, reducing vulnerability will require Nigeria to shift from reliance on short‑term yield‑driven capital flows towards productive investments that boost economic capacity and generate foreign exchange earnings, analysts say.