Nigeria has cleared its $3.4 billion COVID-era loan from the IMF, signaling economic resilience amid ongoing debt pressures.
The International Monetary Fund (IMF) has confirmed that Nigeria has fully repaid the $3.4 billion loan it received in April 2020 under the Rapid Financing Instrument (RFI), used to cushion the economic fallout from the COVID-19 pandemic and the global oil price collapse.
Key Highlights
– Final payment made on April 30, 2025
– Original loan supported Nigeria during pandemic-induced economic contraction and fiscal stress
– Repayment seen as a boost for Nigeria’s external debt credibility
But There’s a Catch: Despite clearing the principal, Nigeria must continue paying about $30 million annually in Special Drawing Rights (SDR) charges. These apply as long as Nigeria’s SDR holdings (~$4.3B) remain below its SDR allocation (~$5.5B).
2025 Payment Breakdown (IMF Data)
1. SDR charges for 2025: SDR 22.35 million (~$30.24 million)
2. Payments spread across May, August, and November
Context
– Nigeria’s loan was one of the largest RFI disbursements globally in 2020.
– In 2024, Nigeria paid $1.63B to the IMF, forming 35% of all external debt service that year.
– Total external debt servicing rose to $4.66B in 2024 from $3.5B in 2023.
Outlook: The IMF’s confirmation of repayment enhances Nigeria’s debt management credibility, though its SDR burden continues. Officials hope this repayment milestone boosts investor confidence and supports ongoing economic reforms like subsidy removal and exchange rate unification.
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