Where Is Nigeria’s Borrowed Money Going Under Tinubu? Debt Hits N152T in 2025

    

As Nigeria grapples with economic turbulence under President Bola Ahmed Tinubu’s administration, one pressing question looms large: Where is all the borrowed money going? Since taking office in May 2023, the Tinubu government has overseen a relentless borrowing spree, pushing the nation’s public debt to a staggering N152.4 trillion by June 30, 2025—an increase of N3 trillion in just three months. With recent approvals for billions in external loans, including a $21 billion plan for 2025-2026 and an additional $2.3 billion to bridge budget gaps, Nigerians are left wondering if these funds are truly fueling development or simply perpetuating a cycle of debt without visible returns.

The Borrowing Boom: A Snapshot of Tinubu’s Fiscal Strategy

Tinubu’s policies, rooted in deregulation and market reforms, have necessitated heavy borrowing to offset revenue shortfalls and fund ambitious agendas. The 2025 budget, for instance, anticipates N9.27 trillion in new borrowings, comprising N7.43 trillion domestically and the rest externally. This includes a $500 million sovereign sukuk issuance and refinancing of maturing Eurobonds worth $1.118 billion.

Officials claim these loans are critical for stabilizing the economy amid challenges like naira devaluation, inflation hovering above 30%, and global commodity fluctuations. Yet, with debt servicing already consuming over 60% of revenues (N8.94 trillion in the first nine months of 2024), the sustainability of this approach is under scrutiny. The Debt Management Office (DMO) lists major creditors like the World Bank ($18.04 billion), Eurobond holders ($17.32 billion), and China’s Exim Bank ($4.91 billion), highlighting Nigeria’s growing reliance on international finance.

Official Destinations: Infrastructure, Social Sectors, and More

According to government disclosures, borrowed funds are earmarked for priority areas outlined in the “Renewed Hope” agenda. Key allocations include:

• Infrastructure Development: A significant portion, such as $3 billion from the $21 billion plan, is directed toward revamping the 2,044-kilometer eastern narrow-gauge rail corridor. Other projects encompass road networks, power upgrades, and transportation hubs aimed at boosting connectivity and trade.

• Agriculture and Food Security: Loans support initiatives like irrigation systems, fertilizer distribution, and mechanized farming to enhance productivity and reduce import dependency.

• Healthcare and Education: Investments in hospital expansions, medical equipment, and school infrastructure are touted to improve access and quality, addressing long-standing deficits in these sectors.

• Security and Housing: Funds bolster military equipment and operations against insurgency, while housing schemes aim to provide affordable homes for low-income families.

• Water Supply and Other Essentials: Projects for clean water access and environmental sustainability are also on the list, alongside general budget deficit financing and debt refinancing to avoid defaults.

The administration argues that these investments will yield long-term growth, with President Tinubu recently boasting that Nigeria met its 2025 revenue targets early, reducing the need for local bank borrowings. However, the continued pursuit of external loans suggests otherwise.

The Big Question: Transparency and Accountability Gaps

Despite these official narratives, skepticism abounds. Critics, including opposition leaders and civil society groups, point to a lack of tangible progress relative to the borrowing scale. For example, while rail projects are highlighted, many Nigerians report persistent infrastructure decay, with roads remaining pothole-riddled and power outages rampant. In agriculture, promised subsidies have been erratic, leading to food price spikes.

Allegations of mismanagement and corruption further fuel doubts. Reports of funds being diverted to non-essential expenditures, such as lavish government travel or unaccounted contracts, have surfaced in media investigations. The absence of rigorous independent audits exacerbates concerns—how much of the $21 billion will actually reach grassroots projects versus bureaucratic pockets or debt rollovers?

Economists warn that without clear tracking mechanisms, these policies risk entrenching “generational debt,” where future Nigerians pay the price through higher taxes and austerity. The naira’s volatility amplifies this, as dollar-denominated debts become costlier to service.

Implications for Nigeria’s Future

If the borrowed money is indeed flowing to productive uses, it could catalyze recovery. However, the opacity surrounding expenditures under Tinubu’s policies raises red flags. Nigerians deserve detailed breakdowns—project timelines, completion rates, and impact assessments—to ensure accountability.

As the administration pushes forward, calls for fiscal restraint, revenue diversification (beyond oil), and anti-corruption reforms grow louder. Without addressing where the money truly goes, Tinubu’s legacy might be defined not by renewal, but by a mounting debt mountain that overshadows any gains.

In the end, borrowing isn’t inherently bad—it’s the stewardship that matters. Until transparency prevails, the question remains: Where is the money going?