A former Anambra State Governor, Peter Obi, on Monday said that the country’s plan to spend about $11.6 billion on debt repayments in 2026 should worry Nigerians and raise broader questions about the current government’s fiscal priorities.
Obi disclosed this on Monday through a statement published on his official X account, while expressing concern about the plan.
According to him, there is nothing inherently wrong with borrowing when it is guided by prudence and directed toward productive investment.
The Nigeria Democratic Congress (NDC) presidential aspirant, however, noted that Nigeria’s situation is markedly different.
“A huge proportion of past borrowing has been directed toward consumption, with limited visible or sustainable developmental outcomes to justify the scale of indebtedness. It is also important to note that a huge portion of the debt currently being serviced was accumulated under the Tinubu administration itself, while borrowing has continued at a significant pace.
“The administration’s recent external borrowing alone includes about $6 billion (from First Abu Dhabi Bank in the UAE—$5 billion, and UK Export Finance via Citibank London—$1 billion), a further $1.25 billion under consideration from the World Bank, and an additional $516 million arranged through Deutsche Bank, bringing the latest known external loan commitments to roughly $7.8 billion. In addition, domestic borrowing through monthly bond issuances continues to add to the overall debt stock.”
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Against this backdrop, Obi noted that Nigeria’s 2026 budget shows that health is ₦2.46 trillion, education is ₦2.56 trillion, and poverty alleviation is ₦865 billion, giving a combined total of about ₦5.885 trillion for these three critical sectors.
By comparison, Obi explained that debt servicing at about $11.6 billion (approximately ₦17–₦18 trillion, depending on exchange rate assumptions) is almost three times higher than the total allocation to health, education, and social protection combined.
“This imbalance highlights a troubling fiscal reality in which debt obligations increasingly crowd out investment in human capital and poverty reduction. Moreover, even within the limited allocations to these sectors, funds may not be fully released, and a significant portion of what is eventually released could be misappropriated.
He cited countries such as Japan, the United Kingdom, the United States, the United Arab Emirates, Singapore, and Indonesia that are all heavily indebted, yet he noted that their borrowings are largely channelled into education, healthcare, infrastructure, and innovation – sectors that generate long-term economic returns and sustain repayment capacity.
“As a result, despite high debt levels, their obligations remain more manageable because they are tied to measurable productivity”.
He noted that ultimately, the central issue is not borrowing itself, but whether borrowed funds are being converted into measurable productivity, inclusive growth, and improved living standards.
Without this, Obi said, debt servicing shifts from being a temporary fiscal obligation to a long-term structural burden that constrains development and deepens economic vulnerability”, he noted.
His reaction comes days after President Bola Tinubu, while speaking at the recent Africa Forward Summit in Nairobi, Kenya, co-hosted by Emmanuel Macron and William Ruto, disclosed that Nigeria is projected to spend approximately $11.6 billion on debt servicing in 2026.
Obi and Kwankwaso, the presidential candidates of the Labour Party (LP) and New Nigeria Peoples Party (NNPP), respectively, in the 2023 elections, joined the Nigeria Democratic Congress (NDC) recently.
The move came a few months after the duo teamed up with the coalition under the African Democratic Congress (ADC).
They cited a worsening political climate marked by internal crises, external interference, and growing hostility within party structures.
