Nigeria has completed the repayment of the principal amount of its $3.4bn loan from the International Monetary Fund (IMF), with the final payment made on April 30, 2025.
The loan, disbursed in full on April 30, 2020, was part of the IMF’s emergency COVID-19 Rapid Financing Instrument, aimed at helping Nigeria cope with the economic disruptions caused by the pandemic, including falling oil prices, a recession, and fiscal pressures.
Although the principal repayment has been fully settled, The PUNCH found upon further checks of the IMF website that several charges associated with the loan remain due.
These charges, which consist mainly of interest, will continue to be repaid annually for the next few years.
In 2025, Nigeria’s scheduled charge for the loan is SDR 6,548,785 (approximately $8.84m) due in May, with additional charges in August and November, bringing the total charge for 2025 to SDR 22,348,146 (approximately $30.24m).
The charges will remain consistent through 2029, with annual payments for each year ranging from SDR 25,912,903 in 2026 and 2027 to SDR 25,924,726 in 2028 and SDR 25,901,079 in 2029.
Further checks showed that the charges include Net SDR Charges, GRA Basic Charges, and SDR Assessments.
The term Net SDR Charges refers to the interest and associated fees levied by the IMF on its member countries that have borrowed resources from the IMF, denominated in Special Drawing Rights.
The GRA Basic Charges refer to the standard interest and associated fees applied by the IMF on loans issued from its General Resources Account.
SDR Assessments are annual fees levied by the IMF on its member countries participating in the SDR Department.
These charges reflect the ongoing interest payments that Nigeria will need to make on the loan over the next five years.
While the principal repayment has been completed, the IMF’s interest and charges continue to accumulate annually, further extending Nigeria’s financial commitments.
Despite these ongoing charges, the repayment of the principal is a significant achievement for Nigeria, with the full repayment of the $3.4 billion principal amount affirming Nigeria’s progress in meeting its external debt obligations.
However, the continued financial responsibility for interest payments highlights the complexities involved in managing long-term loan repayments.
Debt servicing to the IMF surged to $1.63bn in 2024, made up entirely of principal repayments, with no interest or other charges recorded.
The country’s total external debt servicing for 2024 amounted to $4.66bn, up from $3.5bn in 2023.
Of this, multilateral creditors accounted for the largest portion at $2.62bn or 56 per cent of the total.
The IMF’s share alone accounted for 35 per cent of Nigeria’s total external debt servicing in 2024 and about 62 per cent of the total paid to multilateral lenders.
Also, Nigeria’s debt to the IMF dropped significantly from $2.47bn in 2023 to $800.23m in 2024 — a reduction of 67.6 per cent, or $1.67bn, likely tied to repayments on the emergency and budget-support facility disbursed in 2020. – Punch.
