…Presidency Fires Back, Says Loans Tied to Critical Infrastructure, not Consumption
By Franklin Adole
A fresh war of words has erupted over Nigeria’s rising debt profile, with former Anambra State governor, Peter Obi, sharply criticising the Federal Government’s borrowing approach, drawing a swift rebuttal from presidential spokesman, Bayo Onanuga.
In a strongly worded post on his X (formerly Twitter) handle, Obi likened Nigeria’s borrowing pattern to a “killer cancer,” arguing that debt incurred for consumption rather than production poses grave risks to the nation’s economic future.
“Borrowing is not only a leprosy, but a killer cancer when it is borrowed for consumption and not production,” he wrote, contending that Nigeria’s debt burden is largely unproductive and fails to translate into tangible economic gains.
The Labour Party presidential candidate in the 2023 election maintained that responsible borrowing must be tied to measurable economic value, including job creation, growth, and improved living standards. He warned that accumulating debt without clear returns undermines national autonomy and strains future fiscal capacity.
Citing provisions of the Fiscal Responsibility Act 2007, Obi argued that government borrowing must be backed by clear purpose and cost-benefit analysis, demonstrating its impact on economic growth and citizens’ welfare.
According to him, many of the loans obtained by the current administration do not meet these standards, raising concerns about sustainability—especially in light of Nigeria’s high debt servicing obligations.
“What matters is not just the debt-to-GDP ratio, but the debt servicing ratio, which limits our ability to invest in critical sectors,” Obi stated, adding that poorly utilised loans create a “double jeopardy” by increasing repayment burdens without boosting productivity.
However, the Presidency dismissed Obi’s claims as misleading and politically motivated.
Responding to Obi on Twitter, Onanuga accused the opposition politician of “demagoguery,” insisting that borrowing is a standard global practice and not inherently problematic.
“Every sovereign nation borrows,” Onanuga said, echoing earlier remarks by President Bola Ahmed Tinubu that borrowing is not “leprosy.”
He maintained that the Tinubu administration’s loans are being channelled into critical infrastructure projects, not consumption, and argued that Nigeria’s ability to secure financing from international lenders reflects confidence in the country’s economic credibility.
“The fact that we are receiving funds and have willing lenders shows that our country is credible and capable of repaying,” Onanuga added, urging Obi to adopt a more “rational” approach to public discourse.