Amidst concerns over Nigeria’s rising debts, the Centre for Fiscal Transparency and Public Integrity (CeFTPI) has criticised the National Assembly for not sufficiently checking the executive’s financial actions, emphasising the urgent need for a public debt integrity mechanism to address the situation.
The centre, in a press statement signed by the Executive Director, Umar Yakubu, urged both the legislative and executive arms of government to act “decisively by establishing a robust Public Debt Integrity Mechanism to prevent a looming fiscal crisis.”
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They lamented that the country’s debt burden had surged since the administration of the former President Olusegun Obasanjo, which succeeded in achieving significant debt relief. This achievement reduced Nigeria’s external debt from approximately $35 billion to about $2.11 billion by 2007.
The President Obasanjo-era debt relief followed a landmark agreement with the Paris Club. However, in 2024, the former president stated that when he left office in 2007, “the quantum of debt I left was about $3.5/3.6bn from over about $36bn.” He also lamented the country’s recent debt profile.
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According to Nigeria’s Debt Management Office (DMO), as of 31 December 2024, Nigeria’s total public debt stood at N144.7 trillion (approximately $94.2 billion). About 51.4 per cent of the total (N74.4 trillion) is domestic debt, while 48.6 per cent (N70.3 trillion) is external debt.
The rising debt has resulted in increased debt servicing costs. In 2023, Nigeria spent N7.8 trillion on debt servicing, a 121 per cent increase compared with N3.52 trillion in the previous year.
The amount spent on debt servicing rose to N13.12 trillion in 2024, a 68 per cent increase from the 2023 figure. These high debt servicing costs mean less funds for important sectors such as infrastructure and social services, potentially hindering economic growth and development.
On 22 July, the Senate approved the 2025-2026 external borrowing plan of $21.5 billion. According to President Bola Tinubu, the loan request was aimed at funding various critical national development projects across key sectors of the economy.
He also said the borrowing plan was in accordance with the Fiscal Responsibility Act of 2007 and the Debt Management Office (DMO) Act of 2003.
The CEFTPI insisted on Tuesday that introducing a Public Debt Integrity Mechanism—rooted in transparency, accountability, and strategic planning—is essential to rein in Nigeria’s escalating debt problem.
Pillars of the debt mechanism
The group demanded a public disclosure of all Nigeria’s borrowing details from 1999, including the details of utilisation and repayment.
It also called for an investigation of the usage of loans and the sanctioning of office holders who violated the Fiscal Responsibility Act. Furthermore, they proposed that new loans should be considered for projects with “high economic returns.”
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It urged the National Assembly to “Utilise its oversight powers to scrutinise all new loan requests and push for legislative reforms that will enshrine fiscal discipline,” and also embrace “global benchmarking tools, such as the Public Debt Management Assessment Toolkit (PDMAT), to systematically evaluate and strengthen its oversight capacity.”
Similarly, in August, another group, Citizen Monitors, called on the federal government to ensure transparency, enhanced debt-risk controls, and citizen-level tracking of project results following the Senate’s approval of the 2025-2026 external borrowing plan of $21.5 billion presented by Mr Tinubu for consideration.
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