Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has called on the International Monetary Fund (IMF) and the World Bank to reduce borrowing costs for developing countries, citing mounting debt pressures and limited access to concessional financing.
Edun made this known on Tuesday, April 14, while answering questions during a media briefing of the Intergovernmental Group of Twenty-Four (G-24) on the sidelines of the launch of the IMF’s April 2026 Global Financial Stability Report.
His call comes as the IMF projects global economic growth to decline from 3.4% in 2025 to 3.1% in 2026, largely due to the impact of the ongoing conflict in the Middle East.
What they are saying
Edun highlighted the growing strain on developing economies, noting that declining concessional financing is worsening economic prospects, particularly in Sub-Saharan Africa, where growth is expected to slow from 4.5% in 2025 to 4.3% in 2026 amid global and domestic pressures.
He stressed the need for urgent support mechanisms to ease financing conditions, calling for tools that can lower borrowing costs for vulnerable economies.
- “We would like them, especially at this time, to provide additional liquidity and risk management tools that reduce the cost of financing,” Edun said.
He added that high interest rates and rising debt servicing burdens are limiting the ability of developing countries to invest in growth and achieve long-term development goals, as a significant portion of government revenue is now being diverted to servicing debt rather than funding infrastructure, healthcare, and education.
Corroborating Edun’s position, Iyabo Masha, Director of the G-24 on International Monetary Affairs and Development, noted that some member countries are already facing extremely high borrowing costs.
She revealed that two G-24 member countries present at the briefing rank among those paying the highest interest rates globally, underscoring the urgency of intervention.
- “This is one area where the IMF can support developing countries. There are also ongoing discussions with the World Bank on ways to further support developing countries,” Masha said.
More insights
Rising debt levels across Africa continue to heighten fiscal risks, as governments grapple with increasing repayment obligations.
According to S&P Global Ratings, African countries are expected to pay over $90 billion in external debt servicing this year, more than three times the amount recorded in 2012.
- Egypt accounts for nearly one-third of this total, with about $27 billion in principal repayments, followed by Angola, South Africa, and Nigeria.
- Recent reports also indicate mounting pressure on Nigeria’s finances. Fitch Ratings projects that the country’s foreign exchange reserves could decline to $47 billion by the end of 2026.
In 2025 alone, Nigeria spent $5.21 billion on external debt servicing, representing over 72% of its total international payments, highlighting the growing strain on its fiscal position.
What you should know
Edun’s call for multilateral institutions to do more comes as the IMF recently cut Nigeria’s 2026 growth forecast by 0.3 percentage points to 4.1%, down from 4.4%, citing increasing global and domestic pressures.
According to the Fund, the downgrade reflects rising fuel, fertilizer, and shipping costs, which are weighing on non-oil sectors, even as higher oil prices offer some support.
These pressures are largely driven by the ongoing conflict in the Middle East, which has pushed up global energy prices and triggered a sharp increase in domestic fuel costs in Nigeria.
- While Nigeria may benefit from higher oil revenues, petrol prices have surged from about N799 per litre before the conflict to around N1,200 per litre, intensifying the cost-of-living crisis.
The rise in fuel costs has already translated into higher transportation and food prices across the country, further straining households, according to recent reports by Nairametrics.
