Former Anambra State Governor and presidential aspirant of the Nigeria Democratic Congress (NDC), Peter Obi, has expressed deep concern over Nigeria’s plan to spend about $11.6 billion on debt servicing in 2026, warning that the development should worry Nigerians and trigger serious conversations about the government’s fiscal priorities.
Obi made the remarks on Monday in a statement shared through his official X account, reacting to comments made by President Bola Tinubu during the recent Africa Forward Summit in Nairobi. The summit was co-hosted by Emmanuel Macron and William Ruto, where Tinubu disclosed that Nigeria is projected to spend approximately $11.6 billion on debt repayments in 2026.
According to Obi, borrowing is not inherently wrong if it is done prudently and channelled into productive sectors that can stimulate economic growth and improve living standards. However, he argued that Nigeria’s current debt profile reflects years of borrowing largely targeted at consumption, with little visible or sustainable development to justify the rising debt burden.
He further stated that a significant portion of the debt now being serviced was accumulated under the Tinubu administration, while new borrowing continues aggressively. Obi listed recent external loan commitments, including about $5 billion from First Abu Dhabi Bank in the United Arab Emirates, $1 billion through UK Export Finance via Citibank London, another $1.25 billion being considered from the World Bank, and an additional $516 million arranged through Deutsche Bank. According to him, these commitments bring Nigeria’s latest known external borrowing to roughly $7.8 billion, excluding continued domestic borrowing through monthly bond issuances.
Obi also highlighted what he described as a troubling imbalance in the proposed 2026 budget. He noted that allocations for healthcare, education, and poverty alleviation stand at ₦2.46 trillion, ₦2.56 trillion, and ₦865 billion respectively — amounting to a combined ₦5.885 trillion.
In contrast, he explained that the projected debt servicing figure of $11.6 billion translates to approximately ₦17 trillion to ₦18 trillion, depending on exchange rates, which is almost three times the total allocation to the three critical sectors combined.
“This imbalance highlights a troubling fiscal reality in which debt obligations increasingly crowd out investment in human capital and poverty reduction,” Obi stated, adding that even the limited funds allocated to these sectors may not be fully released or properly utilised.
Drawing comparisons with countries such as Japan, United Kingdom, United States, United Arab Emirates, Singapore, and Indonesia, Obi noted that although those nations also carry large debts, their borrowing is largely invested in infrastructure, healthcare, education, innovation, and other productive sectors that strengthen economic growth and repayment capacity.
He stressed that the major issue is not borrowing itself, but whether borrowed funds are being converted into measurable productivity, inclusive growth, and improved living standards for citizens.
“Without this, debt servicing shifts from being a temporary fiscal obligation to a long-term structural burden that constrains development and deepens economic vulnerability,” Obi warned.
