The Presidency has defended Nigeria’s growing debt profile, stating that recent borrowings are deliberately targeted at rebuilding critical infrastructure and stimulating long-term economic growth.
This position was outlined by Daniel Bwala, Special Adviser to President Bola Tinubu on Policy Communication, amid concerns over the country’s continued reliance on loans despite sweeping fiscal reforms.
Bwala argued that Nigeria’s infrastructure gap remains vast and underfunded, making external financing unavoidable in the short term.
According to him, current investments fall significantly below what is required to address decades of neglect in key sectors such as transport, power, and public utilities.
“Government borrowing at this stage is strategic,” he said.
“It is focused on unlocking productivity by fixing the systems that drive economic activity. Without functional infrastructure, growth will remain constrained.”
His remarks followed recent comments by the Emir of Kano, Muhammad Sanusi II, who questioned the government’s fiscal direction.
Sanusi had pointed out that Nigeria still depends heavily on borrowing, even after the removal of petrol subsidies, a policy expected to ease pressure on public finances.
The monarch suggested that while subsidy removal was necessary, it has not translated into reduced borrowing, raising concerns about policy coherence.
He further noted that an oil-producing nation like Nigeria should not continue subsidising foreign refining capacity, especially as domestic refining improves.
Moreover, Sanusi, a former governor of the Central Bank of Nigeria, acknowledged progress in local refining and export potential.
However, he stressed that such gains must be matched with disciplined fiscal management.
“Reforms should produce visible economic relief,” he stated.
“If savings from subsidy removal are not reducing debt dependence, then the policy outcomes need closer scrutiny.”
In response, Bwala maintained that infrastructure financing requires sustained investment over time, insisting that borrowing, when properly managed, remains a legitimate tool for development.
He added that the administration is prioritising projects capable of delivering measurable economic returns, noting that improved infrastructure would ultimately reduce the need for borrowing by expanding revenue generation.
The exchange highlights an ongoing debate within policy circles over Nigeria’s fiscal strategy, particularly how best to balance reform-driven savings with the urgent need for capital-intensive development.
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