SNOW TV NEWS DESK
Nigeria accounted for 16 percent of Africa’s outstanding corporate debt as of December 2025, positioning it as the continent’s second-largest corporate debt market, behind South Africa, according to the Organisation for Economic Co-operation and Development.
The findings, contained in the OECD’s Africa Capital Markets Report 2026, show that South Africa dominated the market with 31 per cent of the continent’s corporate debt, while Nigeria followed with 16 per cent and Egypt accounted for 13 per cent.
Mauritius, Mozambique, and Morocco contributed nine percent, six percent, and five percent, respectively. Collectively, the six countries represented 80 percent of Africa’s outstanding corporate debt, highlighting how corporate financing remains concentrated in a relatively small number of economies.
Nigeria’s position reflects the size and growing relevance of its business financing market. However, the figures also raise important questions about how easily companies can access affordable, long-term funding to support investment and expansion.
The situation is particularly significant given the high cost of borrowing in Nigeria, where elevated interest rates and increasing government demand for credit continue to influence lending conditions. As public borrowing rises, private businesses may face additional pressure to compete for available funds.
Figures from the Debt Management Office show that Nigeria’s total public debt climbed to N166.79tn as of June 30, 2026, up from N159.35tn at the end of March, representing an increase of N7.44tn within three months.
The Federal Government also proposed N29.2tn in fresh borrowing in its 2026 budget, underscoring the scale of its financing requirements and the potential pressure on domestic credit markets.
The OECD report further noted that corporate financing across Africa still relies heavily on syndicated loans, with bank lending remaining a major source of funding for businesses in several economies, including Nigeria.
Although Nigeria has recorded increased activity in corporate bonds and commercial papers, many businesses remain exposed to changes in monetary policy and bank lending rates. This dependence can make long-term investment planning difficult, particularly for companies facing rising financing costs.
Beyond identifying these challenges, the OECD highlighted the significant financing opportunities available within Africa itself. The organization estimated that the continent holds more than $4.4 trillion in domestic capital pools, including pension funds, insurance assets, bank deposits, sovereign wealth funds, and resources managed by development finance institutions.
It argued that directing more of these funds into domestic and regional capital markets could help bridge financing gaps, support infrastructure development, and accelerate industrialization.
Despite this potential, Africa accounted for just 0.4 percent of global market capitalization in 2024, reflecting the relatively limited role of its capital markets in global finance.
For Nigeria, the challenge is therefore not simply its share of Africa’s corporate debt but how to translate its market position into more accessible and affordable financing for businesses. Expanding capital market participation and mobilizing long-term domestic savings could help reduce dependence on bank loans and create more sustainable funding options for the private sector.
“Sir Bartholomew White Ebe is a Lagos-based media personality, Music Artist, Producer, and a Relationship Coach and independent journalist. With over seven years of experience tracking political developments and cultural shifts in Nigeria, he specializes in local current affairs, grassroots politics, and community-driven reporting across Lagos State. As the founder and chief editor of Snow Multimedia Connect {SNOW TV}, he leads the editorial team to deliver verified, high-impact stories to digital audiences.”
Email: snowmediaconnect@gmail.com
