The World Bank has disclosed that Nigeria and other developing countries are collectively burdened with an estimated $8.9 trillion historic debt, raising fresh concerns over debt sustainability and fiscal stability across low- and middle-income economies.

The World Bank made this known in a recent report assessing global public debt trends, noting that the rising debt profile of developing countries had reached unprecedented levels due to a combination of economic shocks, weak revenue growth, high borrowing costs and currency depreciation.

According to the report, the debt stock represents the highest level ever recorded for developing economies, with many countries spending more on debt servicing than on critical sectors such as health, education and social protection.

The Bretton Woods institution noted that Nigeria, Africa’s largest economy, alongside several other emerging and developing nations, had been significantly affected by global economic disruptions, including the COVID-19 pandemic, geopolitical tensions and tightening global financial conditions.

It explained that higher interest rates in advanced economies had increased the cost of external borrowing, while reduced access to concessional financing had forced many countries to rely on expensive commercial loans.

“Developing economies are facing a historic debt challenge, with total public debt reaching about $8.9 trillion. This situation limits fiscal space and constrains governments’ ability to invest in growth-enhancing and poverty-reducing programmes,” the World Bank said.

The report warned that without urgent reforms, many countries could face heightened risks of debt distress, macroeconomic instability and slower economic growth.

In the case of Nigeria, the World Bank noted that while the country had undertaken several fiscal and structural reforms aimed at boosting revenue and improving public finance management, debt servicing costs remained high relative to government revenues.

It urged Nigeria and other affected countries to strengthen domestic revenue mobilisation, improve expenditure efficiency and prioritise concessional borrowing to reduce vulnerability to external shocks.

The World Bank also called on creditors, development partners and multilateral institutions to support debt relief initiatives, promote transparency in lending, and expand access to affordable financing for vulnerable economies.

It stressed that coordinated global action was necessary to prevent a debt crisis that could reverse development gains and worsen poverty levels in many parts of the world.