Presidency Justifies Borrowing Strategy, Says “It Is Not A Sin To Borrow”

The presidency has defended its borrowing approach, describing it as a necessary instrument for driving economic development. It emphasized that when loans are utilized responsibly, borrowing should not be viewed negatively.

This clarification was made during a media interaction held in Lagos, where senior presidential aides addressed journalists on the administration’s economic achievements and future plans.

Just last week, President Bola Tinubu submitted a request to the National Assembly, seeking approval for fresh external and domestic loans amounting to N34.15 trillion.

Speaking on the matter, Special Adviser to the President on Information and Strategy, Mr. Bayo Onanuga, responded to concerns over Nigeria’s debt profile, stating, “It is not a sin to borrow. Even developed nations like the United States of America (USA) and the United Kingdom (UK) borrow beyond their GDP. The issue is not borrowing; it is what you do with the borrowed funds. We are a poor country with a large population. We must stop deceiving ourselves; Nigeria’s budget is smaller than that of South Africa. We have to be realistic about what we can fund without borrowing.”

Onanuga explained that the Tinubu administration has made significant progress in implementing macroeconomic reforms and social inclusion policies, even as it works to manage the difficult economic situation inherited from previous administrations.

Reflecting on the administration’s first year, he said, “We acknowledge that the first year of this administration was turbulent. We faced serious challenges, including inflation, forex instability, and legacy issues that were beyond our immediate control.”

He added that “Today, Nigeria’s macroeconomic indicators have improved significantly. This has not gone unnoticed; global institutions like the World Bank and International Monetary Fund (IMF) have commended our efforts and direction.”

Onanuga highlighted some of the positive shifts in the country’s financial indicators, noting, “Nigeria’s All Share Index has more than doubled from 50,000 in 2023 to over 110,000 in 2025. The country’s foreign reserves currently stand at $21 billion, up significantly from previous lows. Nigeria’s debt servicing has dropped from 97 percent of government revenue to under 60 percent, freeing up fiscal space for investment in social services.”

He pointed to the use of public-private partnerships (PPPs) and innovative financial mechanisms—such as Infraco, tax credit schemes, and state-matched funds—to deliver critical infrastructure like roads and housing.

“Over 600,000 students have benefited from the student loan scheme under NELFUND, among others. We are laying the groundwork for Nigeria’s industrial base through technical education and financial access,” he said.

Addressing the rising cost of living and efforts to ease public hardship, Onanuga remarked, “We fully understand that Nigerians are going through tough times. But the government is not sitting idly. We have rolled out specific interventions to ease the burden, from bulk procurement of essential drugs under the medical pool initiative to direct agricultural support aimed at stabilizing food prices.”

He also pointed to the push for Compressed Natural Gas (CNG) adoption in transportation as a way to reduce fuel costs: “Today, some ride-hailing drivers who used to make N10,000 weekly now earn that daily, just from savings on fuel.”

Further explaining the administration’s approach to food inflation, he said, “Also, the President approved a six-month waiver on rice importation. That move was deliberate to crash food prices and break the cycle of hoarding and artificial scarcity.”

He concluded by urging Nigerians to be more realistic in their expectations: “We need to be honest with ourselves. Nigeria is not as rich as many people think. We are a large country with limited resources and an exploding population. The truth is, we must recalibrate our expectations and begin to manage our ambitions more realistically.”

Also weighing in, Special Adviser to the President on Public Communication, Mr. Sunday Dare, stressed the importance of borrowing for large-scale development projects: “We can’t build highways from Lagos to Calabar or Sokoto to Bida without borrowing. Projects like these wake up entire regions economically. The real problem is not debt; it is waste. With proper utilization, borrowing is a tool for national transformation.”