Tinubu’s Fresh $24bn Loan Request Could Push Nigeria’s Debt to N183tn

President Tinubu

Nigeria's public debt may surge to nearly N183tn if President Bola Tinubu’s fresh external borrowing plan is approved by the National Assembly, raising growing concerns over debt sustainability.

The President is seeking approval to borrow $24.14bn as part of the Federal Government’s 2025–2026 borrowing plan. The proposed loans comprise $21.54bn, €2.19bn, and ¥15bn. Based on current exchange rates, this translates to an additional N38.24tn in debt, potentially pushing the nation’s total public debt from N144.67tn as of December 2024 to over N182.91tn by 2026.

According to the Debt Management Office, Nigeria’s total debt stock rose by 48.58% in 2024 alone—from N97.34tn in 2023 to N144.67tn—driven by both external and domestic borrowings, compounded by the naira’s depreciation.

• External debt: Jumped from N38.22tn ($42.5bn) in 2023 to N70.29tn ($45.78bn) in 2024.

• Domestic debt: Increased from N59.12tn to N74.38tn.

• Federal Government share: Grew to N70.41tn.

• States/FCT share: Dropped from N5.86tn to N3.97tn.

If approved, the new borrowing will raise Nigeria’s external debt to nearly $70bn, a 52.7% increase, and boost the external component of total debt to over N108tn. The Federal Government’s total debt would climb from N133.33tn to N171.57tn, a 28.7% increase.

Purpose of the Loan

In a letter to the House of Representatives, President Tinubu said the borrowing will fund critical sectors such as infrastructure, agriculture, healthcare, education, water, security, and public finance reforms. He assured that the projects had been appraised and were expected to stimulate growth and improve service delivery.

Additional Financial Moves

The President also seeks:

Approval for a $2bn foreign currency bond to be issued in Nigeria’s domestic debt market.

Legislative support to issue N757.98bn in bonds to clear outstanding pension arrears under the Contributory Pension Scheme.

Combined, these measures could push Nigeria’s total debt far beyond N182.91tn, especially as they exclude additional domestic borrowings expected in 2025–2026.

Economists React

Experts have expressed serious concerns about the rising debt burden:

Johnson Chukwu, CEO of Cowry Assets, stressed that transparency and effective utilisation are more important than the size of the loan. He warned that misuse would turn the debt into a liability, not a catalyst for development.

Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, said debt servicing already outpaces capital expenditure, a worrying sign. He called for greater focus on revenue generation and fiscal discipline, urging caution with new borrowings.

Prof. Segun Ajibola of Babcock University supported the N758bn pension bond, stating it was necessary to restore trust and dignity to retirees, but warned against financing it by printing money.

Marcel Okeke, former Chief Economist at Zenith Bank, criticized the loan request, saying it takes Nigeria “back into the woods,” and lamented repeated borrowing under the guise of infrastructure development.

Political Opposition Speaks Out

The Peoples Democratic Party (PDP) and former Vice President Atiku Abubakar condemned the loan request, describing it as irresponsible and lacking transparency.

PDP National Publicity Secretary, Debo Ologunagba, accused the government of self-serving governance and demanded full disclosure on how previous loans were used. He warned that the National Assembly must stop acting as a rubber stamp and begin holding the executive accountable.

Atiku, through his media aide, Paul Ibe, questioned the rationale for additional borrowing amid Nigeria's fragile economic state, calling for a more sustainable and transparent fiscal approach.