How Edo Rose From 12th To Nigeria’s Sixth Most Indebted State

By TOSAN OYAKHILOME-AKAHOMEN

Edo’s Debt Profile Takes a Sharp Turn

EDO State’s domestic debt profile has changed sharply under Governor Monday Okpebholo, with the state moving from 12th to sixth position among Nigeria’s most indebted states within about 15 months.

Latest figures from the Debt Management Office show that Edo’s domestic debt rose from ₦113 billion at the end of December 2024 to ₦172.37 billion by 31 March 2026.

The increase represents a rise of ₦59.37 billion over the period.

However, the overall figure does not fully capture the volatility in the state’s debt profile.

Edo initially recorded a significant reduction in its domestic debt during much of 2025. The debt fell from ₦113 billion in December 2024 to ₦82.4 billion by March 2025.

It dropped further to ₦80.32 billion in June.

By September 2025, the figure had declined to ₦76.13 billion.

The downward trend, however, did not last.

Edo’s domestic debt rose again to ₦91.18 billion by the end of December 2025. Then came the most dramatic movement.

Within the first three months of 2026, the debt stock increased by ₦81.19 billion to reach ₦172.37 billion.

That represented an increase of about 89 per cent in a single quarter.

The speed of that rise has placed the Okpebholo administration’s borrowing and fiscal strategy under closer scrutiny.

Fresh Loans Drive Part of the Increase

Budget performance records show that Edo began taking fresh loans during the third quarter of 2025.

Between July and September, the state reportedly obtained a ₦10.64 billion loan.

Borrowing then increased substantially in the first quarter of 2026.

The state’s First Quarter 2026 Budget Performance Report shows that the government obtained ₦46.71 billion from commercial banks between January and March.

That borrowing accounted for more than half of the ₦81.19 billion increase recorded in Edo’s domestic debt during the same period.

Nevertheless, the commercial bank loan does not completely explain the scale of the increase.

A substantial gap remains between the ₦46.71 billion identified in the budget report and the overall increase in the state’s domestic debt stock.

That gap raises further questions about other obligations, facilities or financial movements that may have contributed to the rise.

The state government will therefore face pressure to provide greater clarity on the composition of the additional debt and the specific projects or programmes financed through the borrowing.

Debt Service Begins to Compete for Public Funds

The increase in borrowing also carries consequences for Edo’s future budgets.

In 2025, the state spent ₦43.73 billion on public debt charges.

The figure included ₦13.73 billion in interest payments on foreign loans and ₦7.33 billion in interest on domestic borrowing.

The government also paid ₦5.75 billion as foreign loan principal and ₦16.92 billion as domestic loan principal.

By the end of the first quarter of 2026, Edo had already spent ₦12.79 billion on debt charges.

That amount represented almost 30 per cent of the entire debt-service expenditure recorded in the previous year.

Debt, by itself, does not necessarily indicate poor fiscal management. Governments often borrow to finance infrastructure, expand public services or bridge funding gaps.

The crucial question is whether the borrowed funds produce assets and economic activity capable of supporting repayment.

For Edo, the challenge will be to demonstrate how the new obligations translate into measurable public value.

From 12th to Sixth in 15 Months

Perhaps the clearest indicator of the scale of the change is Edo’s movement in the national domestic debt ranking.

At the end of 2024, the state occupied 12th position.

By March 2026, it had climbed to sixth.

The development places Edo among the states with the largest domestic debt exposure in Nigeria.

It also creates a new test for the Okpebholo administration.

The government must balance the need to finance infrastructure and development against the growing cost of servicing loans.

As the debt stock expands, so does the amount of public revenue required to meet repayment obligations.

That could reduce the fiscal space available for education, healthcare, infrastructure and other essential services if revenue growth fails to keep pace.

The Bigger Question for Edo Taxpayers

The debate over Edo’s rising debt will ultimately go beyond the amount borrowed.

The more important issue concerns the value created with the money.

If the loans finance productive infrastructure, improve public services and strengthen internally generated revenue, the borrowing could support long-term economic growth.

However, if debt grows faster than the state’s capacity to generate revenue and service its obligations, future budgets could come under increasing pressure.

For taxpayers, the real measure of the borrowing will therefore lie in visible results.

The state will need to show where the money went, what projects it financed and whether those investments can justify the long-term obligations now placed on Edo’s finances.

The rapid shift from declining debt to one of Nigeria’s six largest domestic debt stocks has made transparency and fiscal accountability more important than ever.