- The Minister of Finance, Wale Edun, has warned that about 50% of low-income countries are in or nearing debt distress
- The country's debt service-to-revenue ratio is projected at 47% in 2025, raising fiscal sustainability concerns
- Edun said Global South countries now spend more on debt servicing than they receive in aid and foreign investments
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has raised concerns over the rising global debt service burden, warning that nearly half of low-income countries are either in debt distress or at high risk of it.
Edun spoke at the ongoing Technical Group Meeting of members of the Group of 24 (G-24) in Abuja, where he highlighted the mounting fiscal pressures confronting developing economies.
Although he did not specify Nigeria’s position in his remarks, the World Bank classifies Nigeria as a lower-middle-income country for 2024–2026, not a low-income nation.
Nonetheless, Nigeria’s public debt has continued to climb since 2023, with estimates placing it at an all-time high of about $100 billion. The country’s debt service-to-revenue ratio is projected at 47 per cent in 2025, reflecting significant fiscal strain.
At the meeting, Edun warned that debt servicing has become an overwhelming burden for countries in the Global South.
He noted that total annual debt servicing payments by debtor nations now exceed the combined inflows of Overseas Development Assistance and Foreign Direct Investment from the Global North.
Speaking further, Edun stated: “The gathering was an opportunity to re-shape the development trajectory of the Global South at a time when global risks are converging faster than institutions can respond.”
He added that about 25 per cent of Emerging and Developing Economies (EMDEs) have lost access to international capital markets, making domestic revenue mobilisation more critical than ever.
Also addressing participants, the Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, described cross-border payments among G-24 countries as inefficient and expensive.
His words, “Today, cross border payments remain too slow, too costly, and too fragmented, especially for developing economies. With global remittance corridors costing over 6.0 percent, settlement lags of several days, and compliance burdens that exclude MSMEs, millions remain disconnected from global opportunity.”
Cardoso called for urgent reforms driven by digitalisation to make cross-border transactions faster, cheaper and more inclusive. According to him, his keynote address titled “Digital Cross-Border Payments, Global Finance, and Economic Transformation – Opportunities and Risks” was not just a technical conversation but a core development priority for G-24 member states.
He commended Edun, who chairs the G-24, for clearly articulating the group’s vision centred on modernising global finance, strengthening domestic capacity, and ensuring that digital transformation promotes shared prosperity.
According to him, “These priorities resonate deeply with the mandate of central banks across the G-24 countries.”
The CBN governor further emphasised the growing importance of cross-border payment systems to global financial stability.
The CBN boss added, “Across the world, cross border payments are becoming the backbone of the international monetary and financial system. For G 24 economies, inefficiencies in these systems translate directly into higher remittance costs, costly FX transactions, fragmented settlement processes, and barriers to MSME participation in global trade.
“Improving cross border payments, therefore, is not simply a technical reform, it is a macroeconomic and development priority. The channels through which capital, remittances and trade flows move, now form a critical part of global financial stability architecture.”
Earlier, Director and Head of the G-24 Secretariat, Iyabo Masha, noted that the meeting was taking place at a period of significant global uncertainty, policy fragmentation and structural shifts.
Her words, “We meet at a moment of measured resilience but constrained ambition in the global economy. For many EMDEs, the challenge is no longer simply to ‘recover,’ but to restore development trajectories, protect macroeconomic stability, and finance transformation in a world of higher volatility.”