By Umar Farouk Bala
The latest announcement that Nigeria has repaid a $3.4 billion mortgage to the Worldwide Financial Fund (IMF) and a N100 billion Sovereign Sukuk bond has been hailed by the federal government as a milestone in financial reform.
But, buried beneath the fanfare is a sobering element: Nigeria nonetheless faces further funds within the type of “Particular Drawing Rights” expenses—estimated at $30 million yearly to the IMF over the following 4 years. That provides as much as $120 million, or roughly N180 billion.
This celebration hides a painful fact: Nigeria’s debt burden stays dangerously unsustainable, and the price of servicing it falls not on the political elite, however on extraordinary Nigerians already fighting poverty and hardship.
The IMF mortgage, taken throughout the COVID-19 pandemic in 2020, and the Sukuk meant for infrastructure, are being spun as symbols of fiscal accountability. However these repayments come amid a bleak financial actuality.
Whereas the federal government celebrates, it has dismantled gas subsidies, eradicated social security nets, and provided no significant enhancements in infrastructure, healthcare, or social welfare.
Extra worrying is the Tinubu administration’s rising urge for food for debt. In lower than two years, it has borrowed N18.7 trillion—about 25% of the full N75.26 trillion borrowed below President Muhammadu Buhari in eight years.
Below Tinubu, Nigeria’s public debt ballooned from N87.38 trillion in June 2023 to N144.67 trillion by December 2024. Exterior debt alone stands at round $42.5 billion, in response to the Debt Administration Workplace.
Regardless of authorities reassurances, this degree of debt is clearly unsustainable—particularly in a rustic the place over 70% dwell in multidimensional poverty. The touted “GDP development” and “elevated revenues” have but to carry actual aid to common Nigerians.
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Worse nonetheless, debt servicing now consumes 96% of Nigeria’s annual price range, leaving little for important investments. The outcome? Dilapidated roads, underfunded colleges, erratic energy, and overcrowded public hospitals.
Since gas subsidies had been eliminated—a uncommon coverage that helped the poor—gas costs have soared, transport prices doubled, and inflation spiraled. But the federal government calls this progress.
How can repaying debt be successful when Nigerians’ dwelling situations are worsening?
The federal government’s declare that international investor confidence is rising rings hole. International direct funding stays weak, manufacturing is shrinking, and worldwide corporations are fleeing on account of falling client buying energy.
The Nationwide Bureau of Statistics studies a 52.3% drop in manufactured items exports—a transparent crimson flag. The economic system stays overly depending on oil, with little industrial development or job creation.
Although international reserves rose from $3.99 billion in late 2023 to $23.11 billion in 2024, this implies little to residents dealing with every day hardship—poor electrical energy, insecurity, heavy taxes, and erratic insurance policies.
The Central Financial institution’s declare to have cleared international change backlogs could have helped airways and multinationals however not Nigerian entrepreneurs struggling to import items or civil servants whose wages are eroded by inflation.
As a substitute of celebrating debt reimbursement, the federal government ought to be held accountable for neglecting investments that instantly enhance folks’s lives. Public infrastructure crumbles. Healthcare stays out of attain. Social safety is sort of absent.
If the Tinubu administration actually desires to construct confidence, it should spend money on Nigerians—prioritizing training, housing, clear power, and small companies. It additionally means actual anti-corruption reforms and slicing the bloated price of governance.
Nigeria’s debt repayments could win reward from elites and credit standing businesses hundreds of miles away. However for thousands and thousands dwelling in poverty and despair, such reward presents little consolation.
Till financial development delivers actual advantages—higher roads, respectable housing, high quality training, reasonably priced meals, dependable electrical energy, and accessible healthcare—Nigeria’s debt burden will stay not only a monetary problem however an ethical failure.
