Nigeria’s net foreign liability position increased by $7.5 billion in 2025, reaching $90.2 billion, according to the latest International Investment Position (IIP) report released by the Central Bank of Nigeria (CBN). The report shows that foreign investors now hold more financial claims on Nigerian assets than Nigerians hold on investments abroad.
The data revealed that Nigeria’s net foreign liabilities rose from $82.7 billion in 2024 to $90.2 billion in 2025. During the same period, the country’s total external assets stood at $125.6 billion, while total foreign liabilities reached $215.8 billion.
The International Investment Position measures the total value of a country’s foreign financial assets and liabilities at a specific point in time. Unlike the Balance of Payments, which records trade and financial transactions over a period, the IIP provides a snapshot of the country’s financial relationship with the rest of the world.
One of the major reasons for the increase in foreign liabilities was the strong rise in portfolio investments. According to the CBN, portfolio investment liabilities grew by $10.1 billion, largely because foreign investors increased their holdings of Nigerian government debt instruments, including Open Market Operation (OMO) bills.
Analysts say Nigeria’s high interest rates made these investments more attractive, encouraging foreign investors to move more funds into the country’s financial markets in search of better returns.
Foreign direct investment also recorded steady growth during the year. The report showed that direct investment liabilities increased by $6.7 billion, indicating that more foreign investors expanded their ownership stakes in Nigerian businesses and subsidiaries. This reflects continued confidence in selected sectors of the Nigerian economy despite global economic uncertainties.
On the positive side, Nigeria strengthened its external financial position through higher reserve assets. The country’s foreign reserves increased by $5.6 billion, providing a stronger financial cushion against external economic shocks. Nigerian individuals and companies also expanded their investments abroad, adding another $3.3 billion to the nation’s external assets.
Although the growth in foreign investment supports foreign exchange liquidity and helps stabilise the naira, economists warn that the increasing dependence on foreign capital carries certain risks.
A large share of the recent inflows came through short-term portfolio investments rather than long-term productive investments. Such funds can leave the country quickly if global interest rates become more attractive elsewhere or if investor confidence declines.
Experts also note that higher foreign holdings of Nigerian debt securities could increase pressure on the country’s foreign exchange reserves in the future, especially when investors decide to repatriate profits, collect interest payments, or withdraw their investments.
Economic analysts believe Nigeria can improve its long-term financial stability by attracting more foreign direct investment into sectors such as manufacturing, agriculture, technology, and infrastructure. They also recommend increasing non-oil exports to generate more foreign exchange earnings and reduce reliance on external borrowing and short-term capital inflows.
Higher crude oil prices could also improve Nigeria’s external position by boosting export earnings and increasing foreign exchange inflows. However, experts stress that lasting economic stability will depend on building a stronger and more diversified economy that relies on productive investments rather than short-term financial inflows.
