Criticism of Government Borrowing and Economic Management
Peter Obi, the Labour Party’s presidential candidate in the 2023 elections, has raised concerns about the current administration’s approach to borrowing, highlighting what he sees as a lack of accountability and sustainable economic planning. His remarks come in response to recent approvals of significant external and domestic loans, which have further increased Nigeria’s national debt.
Obi pointed out that the Nigerian Senate recently approved an additional $21 billion, 2.2 billion euros, and ¥15 billion in external borrowing for the 2025-2026 fiscal cycle. Alongside this, the Senate also authorized a N750.98 billion domestic bond issuance and a 65 million euro grant. With existing public debt standing at around N149.39 trillion as of the first quarter of 2025, these new loans bring the total national debt to approximately N187 trillion. There is growing concern that this figure could surpass N200 trillion by the end of 2025.
Obi emphasized the alarming implications of this level of borrowing. He noted that before the GDP rebasing, Nigeria’s GDP was about N269.2 trillion (around $180 billion). The government has borrowed nearly 70% of this previous GDP. Even after the rebasing, which pushed the GDP to about N372.8 trillion (approximately $243.7 billion), the approved loans mean that the country has borrowed roughly 50.16% of the new GDP. This represents the highest debt-to-GDP ratio in the nation’s history.
The rapid increase in debt is concerning, especially when considering the lack of measurable progress in critical areas such as education, healthcare, electricity generation, security, and poverty reduction. Obi highlighted that the year-on-year increase in debt is about N27.72 trillion, while the quarter-on-quarter increase is approximately N4.72 trillion. This exponential accumulation of unsustainable debt is not yielding tangible benefits for the population.
Education and healthcare systems are underfunded and deteriorating. Many Nigerians, particularly the poor, face limited access to quality healthcare. Security challenges have also worsened, with over 10,217 people killed and 672 villages attacked between May 29, 2023, and May 29, 2025. Despite a significant increase in security spending—from N2.98 trillion in 2023 to N4.91 trillion in 2025—these issues persist.
Infrastructure across the country remains in disrepair, with about 135,000km of the 195,000km of roads remaining unpaved and largely unusable. The power sector is no exception, with less than 5,000 MW of electricity supplied to over 200 million Nigerians. These conditions reflect a broader pattern of neglect in essential services.
Obi also pointed to the worsening poverty crisis, with about 133 million (63%) Nigerians classified as multi-dimensionally poor. Unemployment rates continue to rise, and the situation is exacerbated by a severe malnutrition crisis, particularly in Northern Nigeria. Médecins Sans Frontières (MSF) has recently warned of an escalating humanitarian emergency in Katsina State and other regions.
Despite Nigeria’s vast natural resources, the persistent lack of effective leadership has left millions in poverty. Obi stressed that borrowing is not inherently problematic if it is used for productive investments with clear outcomes. However, the current pattern of reckless borrowing without transparency or accountability is undermining the future of the nation’s youth.
He called on the government to consider the long-term consequences of its fiscal policies and to prioritize the well-being of future generations. Obi urged a return to disciplined economic management, including reducing governance costs, addressing inefficiencies, investing in human capital, and fostering a productive economy.
Nigeria cannot afford to continue borrowing recklessly while poverty deepens and public trust erodes. It is time for a shift toward responsible leadership, people-centered development, and economic policies that deliver measurable impact. A New Nigeria must be built—one where every kobo spent contributes to sustainable and inclusive growth.
