The danger of Tinubu’s borrowing spree

President Bola Ahmed Tinubu yesterday requested approval from the National Assembly to secure a fresh external loan of $7.7 billion (approximately N10.79 trillion) to part-finance the Federal Government’s N31.4 trillion budget deficit for the 2026 fiscal year.

The request, contained in a letter dated October 26, 2026, and addressed to the Senate President, Godswill Akpabio, was read on the floor of the upper legislative chamber during Wednesday’s plenary.

Like many before the latest request, the proposal has drawn criticism from Nigerians across the board. Citizens are increasingly concerned about the government’s propensity to accumulate loans for purposes whose benefits and tangible results they are yet to see on the ground.

However, the administration has defended its borrowing policy, arguing that “it is not how we borrow, but what we build, what value we create and what future we leave behind.” This reasoning suggests that the government believes it can continue borrowing without adequate regard for the volume of debt it accumulates.

This is a fundamentally flawed argument and betrays a troubling disregard for the basic principles of prudent economic management. The volume of borrowing matters, whether for a business, a household or a government. Loans must be repaid, with both principal and interest, and such repayments place a claim on the borrower’s future income and resources. An excessive appetite for borrowing eventually catches up with a debtor when an increasing proportion of available resources is diverted to servicing debt rather than meeting other obligations. This is precisely the situation Nigeria is facing. Yet the government appears determined to maintain that what matters is not how much it borrows but what it does with the money.

Nigeria’s external debt rose from $51.9 billion in the first quarter of this year to $54.523 billion in the second quarter. Within the first half of the year, the country spent $1.824 billion on debt servicing, including principal repayments, interest payments and other charges, according to the Debt Management Office (DMO). These figures should give the government serious cause for concern, particularly at a time when the country’s revenue remains under considerable pressure and millions of citizens are struggling with the rising cost of living.

The second leg of the administration’s argument is equally disturbing because its record does little to inspire confidence. What tangible infrastructure has this government delivered commensurate with the scale of borrowing it has subjected the country to? What assurance is there that Nigerians will see meaningful returns from the loans already contracted, not to mention the additional burden being proposed? These debts will be borne not only by the present generation but also by generations yet unborn.

The truth is that a smaller volume of debt, responsibly managed and invested in carefully appraised projects with clear economic and social benefits, stands a far better chance of delivering sustainable results than an indiscriminate borrowing spree without clearly defined priorities or demonstrable public value.

Our concern is that the government’s apparent disregard for prudent financial management will leave Nigerians with an even heavier debt burden and little to show for it. The country cannot continue accumulating liabilities indefinitely while the benefits of such borrowing remain difficult to identify.

It is also difficult to understand the administration’s appetite for more loans in the light of its promise to channel savings from the removal of the petrol subsidy into addressing Nigeria’s infrastructure deficit and other pressing national challenges. President Tinubu justified the abrupt removal of the subsidy on the grounds that it was necessary to rescue the economy by ending what the government described as a wasteful and fraudulent subsidy regime. The expectation was that the substantial resources saved would be redirected towards critical development needs.

Why, then, does the country continue to resort to borrowing on such a massive scale after the removal of the subsidy? What was the justification for ending the subsidy if the government must still borrow heavily to finance activities that the promised savings were expected to support? Nigerians have every reason to feel short-changed. The subsidy is gone, but the borrowing spree continues unabated. The government owes the public a clear account of what it has saved, how much of the savings has accrued to the Federation Account and how the funds have been utilised.

The Executive’s excesses would have been checked if the country had a legislature willing and able to discharge its constitutional responsibilities.

Under the Constitution, the President may propose borrowing, but the National Assembly has the authority and responsibility to scrutinise such requests before granting approval. Through its relevant committees on finance, appropriation, economic affairs and other related matters, the legislature should subject every loan proposal to rigorous scrutiny to establish its necessity, terms, intended beneficiaries, expected returns and potential costs, including the opportunity cost to the country. Unfortunately, the National Assembly has repeatedly failed to demonstrate the independence and diligence required of it. Rather than subjecting the President’s requests to rigorous interrogation, many lawmakers have appeared content to provide automatic approval, acting more as extensions of the Executive than as representatives of the people. This failure of oversight is one reason why frequent and sometimes questionable loan requests have continued unchecked.

It is therefore imperative that members of the National Assembly, irrespective of party affiliation, rise to the occasion and discharge the responsibilities for which their constituents elected them. This time, they must thoroughly interrogate the latest loan request and demand convincing answers before considering its approval. They must establish the necessity of the proposed borrowing, the viability of the projects to be financed, the repayment arrangements and the implications for the country’s already strained finances.

Daily Trust also calls on Nigerians to prevail on their representatives in both chambers of the National Assembly to speak up and demand accountability. Citizens should insist on knowing why the government needs to continue borrowing on such a scale, where the money saved from the removal of the petrol subsidy has gone and how much has actually accrued from the policy. The government must provide a transparent account of these savings and explain why they have not sufficiently reduced the country’s dependence on borrowing.

Until the Tinubu administration provides satisfactory answers to these fundamental questions, it will be difficult to convince Nigerians that another massive borrowing programme is necessary or justified. The country cannot afford to mortgage its future indefinitely without clear evidence that the debts being accumulated today will deliver lasting benefits to its people.