By Alexander Ekemenah
There is growing concern in strategic quarters that Nigeria’s resort to excessive borrowing (both from external and internal sources) is creating uncertainty about the nation’s prosperity.
This is in accordance with the observable behaviours with each government since 2010 when President Goodluck Jonathan took over the government just four years after Olusegun Obasanjo administration achieved the historic feat of clearing off our entire external debt stock with USD 12 billion.
The growing concern is anchored on the confirmation of Nigeria’s Debt Management Office in April 2026 that Nigeria’s total public debt has hit N159.28 trillion as at December 31. 2025.
This translates to N670,000 owed by every single Nigerian, including the child born today in a hospital with no drugs on the shelves.
In a briefing paper titled “Nigeria’s Borrowing to Breathe – and the Clock is Ticking: How Africa’s Largest Economy Turned a Revenue Problem into a National Emergency” by Alliance for Economic Research and Ethics (AERE) dated May 21, 2026, the organisation revealed the growing crisis with Nigeria’s public financing through borrowing without restraint.
AERE traced the historical background of accumulating debt to the era of Jonathan administration. This was after Obasanjo administration dramatically pulled off a celebrated fiscal feat in African history by paying USD12 billion to obliterate USD30 billion debt owed to Paris Club.
“Under President Goodluck Jonathan, debt crept back to N12.06 trillion by 2015.
“Under Buhari, in eight years, the debt exploded from N12.06 trillion to N87.38 trillion, a 620% increase.
“The Central Bank was pressed into deficit financing through “Ways and Means”; N25.7 trillion of this was securitised into long-term bonds, effectively converting a government overdraft into a generational liability”.
AERE further stated that President Bola Ahmed Tinubu’s administration has added N65.9 trillion to Nigeria’s debt stock in just three years.
To put this in perspective, AERE stated that “it took Nigeria’s first 55 years of independence to accumulate N12 trillion in debt. The current administration has added more than five times that amount in 24 months”.
AERE challenged the often theoretical justification for excessive borrowing to deceive the public.
“Governments love to quote the debt-to-GDP ratio. Nigeria is 35.5% well below the IMF’s 55% distress threshold and far more comfortable-looking than South Africa’s 78.8% or Kenya’s 65.6%. Politicians wave this number like a clean bill of health.”
AERE said this is a deception.
AERE said the correct theoretical basis should be a debt service-to-revenue ratio.
“The number that actually matters is the debt service-to-revenue ratio: how much of every naira earned goes straight to paying creditors.
“Nigeria’s ratio stood at 116.8% in 2024, easing only slightly to 113% in Q12025; according to the Nigerian Economic Summit Group (NESG).
“In January 2025 alone, the CBN’s own data showed the Federal Government paying out N696.27 billion in debt service against total retained revenue of just N583.47 billion. That is a 144% coverage ratio in a single month.”
AERE said the paradox is simple in nature.
“Nigeria has a large economy but collects almost nothing from it. The country’s tax-to-GDP ratio is just 8.2%, the lowest among major Africa’s economies. South Africa collects 24% of its GDP in taxes. Kenya collects 16%. Ghana collects 13%. The sub-Saharan African average is 15%. Nigeria, Africa’s largest economy by GDP and most populous nation, manages 8.2%.
“Every percentage point Nigeria fails to collect is a school not built, a road not paved, a soldier not paid.”
AERE delivered its judgment.
“Nigeria does not have a debt problem. It has revenue problem wearing a debt costume.
“For 257 million Nigerians, the farmer in Benue, the trader in Onitsha, the graduate in Lagos who cannot find a job because interest rates are too high for any employer to borrow and expand, this is not an abstract fiscal debate.
“It is the reason the roads are broken, the hospitals are empty, and the light goes out.
“The number do not lie. The question is whether the people in power are finally ready to listen”.
