Nigeria accounted for 16 per cent of Africa’s outstanding corporate debt as of December 2025, making it the continent’s second-largest corporate debt market, according to the Organisation for Economic Co-operation and Development.

The OECD disclosed this in its Africa Capital Markets Report 2026, which placed Nigeria behind South Africa, with 31 per cent of the continent’s corporate debt, while Egypt accounted for 13 per cent.

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Mauritius contributed nine per cent, Mozambique six per cent and Morocco five per cent.

Together, the six countries represented 80 per cent of Africa’s outstanding corporate debt, highlighting the concentration of corporate borrowing in a small number of economies.

Nigeria’s position reflects its significance in Africa’s corporate financing landscape, although businesses continue to face concerns over the cost and availability of credit.

High interest rates and substantial government borrowing have influenced financing conditions, with concerns that public-sector demand for funds could compete with private businesses seeking loans for investment and expansion.

Nigeria’s public debt has continued to rise. Data from the Debt Management Office showed that the country’s total public debt increased to N166.79tn as of June 30, 2026, from N159.35tn at the end of March.

The N7.44tn increase represented growth within three months.

The Federal Government had also proposed N29.2tn in new borrowing in its 2026 budget, underscoring its reliance on debt financing.

The OECD report noted that corporate financing structures differ across African economies, with syndicated loans remaining the dominant form of market-based corporate financing in most countries.

In Nigeria, commercial papers and corporate bonds have attracted increased activity in the capital market, but bank lending remains a major source of funding for businesses.

The reliance on banks exposes companies to changes in monetary policy, lending rates and credit availability.

When borrowing costs rise or banks tighten lending conditions, businesses may find it more difficult to finance expansion and long-term investments.

The OECD, however, identified opportunities for African economies to improve access to long-term financing by mobilising domestic institutional capital.

The organisation estimated that Africa holds more than $4.4tn in domestic capital pools, including funds managed by banks, pension funds, insurance companies, sovereign wealth funds, public development banks and central banks.

It said directing a larger share of these resources into domestic and regional capital markets could help finance infrastructure, industrialisation and other productive investments.

The report also highlighted the limited global presence of African capital markets, noting that the continent accounted for just 0.4 per cent of global market capitalisation in 2024.

“Overall, capital markets remain underutilised as a source of long-term finance, particularly when compared to other emerging-market economies, limiting their contribution to economic growth and resilience,” the OECD said.

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The findings point to the importance of developing deeper capital markets across Africa, allowing businesses to access longer-term funding beyond traditional bank loans and supporting investment in productive sectors.