Juliet Akoje In Abuja

The Nigeria’s Finance Minister, Wale Edun, and the Speaker of the House of Representatives, Abbas Tajudeen disagreed over the country’s debt profile on Monday.

While Speaker Abbas raised concern about Nigeria’s escalating debt, stating it reached N149.39 trillion (approximately $97 billion) in the first quarter of 2025, from N121.7 trillion the previous year, Minister Edun remained upbeat, arguing that the country’s debt outlook was becoming more manageable.

Abbas cautioned that Nigeria’s debt-to-GDP ratio had hit 52 per cent, exceeding the legal ceiling of 40 per cent and called on parliaments throughout West Africa to intensify their scrutiny of government borrowing to protect their citizens’ future.

The two top officials delivered their remarks at the 11th Annual Conference and General Assembly of the West Africa Association of Public Accounts Committees (WAAPAC), hosted by Nigeria’s House Public Accounts Committee, under the theme: “Strengthening Parliamentary Oversight of Public Debt.”

The National Assembly’s concerns come shortly after it approved President Bola Tinubu’s ambitious external borrowing plan for 2025–2026, which includes $21.19 billion in foreign loans, €4 billion, ¥15 billion, a $65 million grant, and roughly N757 billion in domestic borrowing.

This borrowing plan, endorsed by both the House and Senate Committees on Local and Foreign Debt, also comprises a proposal to raise an additional $2 billion through a foreign-currency bond issued in the domestic market.

Abbas who was represented by House Leader, Prof. Julius Ihonvbere, stated that as of first quarter of 2025, Nigeria’s total public debt stood at N149.39 trillion (about $97 billion), a steep rise from N121.7 trillion in the previous year.

He noted that the debt-to-GDP ratio had soared to 52 per cent, well above the 40 per cent legal threshold.

He warned that this debt escalation had pushed Nigeria beyond its legal borrowing limits and placed considerable strain on its fiscal stability.

Abbas said the trend underscored the pressing need for enhanced parliamentary oversight, improved transparency in the borrowing process, and a unified effort to ensure every borrowed naira delivers measurable economic and social benefits.

He further warned that Africa was facing a continent-wide debt crisis with many nations spending more on debt servicing than they do on essential sectors like healthcare.

Highlighting Africa’s debt composition, Abbas said 35 per cent is owed to private Western lenders, 39 per cent to global financial institutions such as the IMF and World Bank, 13 per cent to bilateral partners, and 12 per cent to China.

The Speaker stressed that loans should be channeled into sectors like infrastructure, healthcare, education, and industries that generate employment, warning against irresponsible borrowing that fuels corruption or unproductive consumption.

He added that oversight efforts must involve the public, suggesting that major loan proposals should be open to public hearings and that debt reports be simplified and made publicly accessible to ensure transparency and citizen awareness.

In contrast, Finance Minister Edun presented a more optimistic assessment, saying Nigeria’s economy is recovering under the reform agenda of President Tinubu.

Edun noted that in 2024, the ratio of debt service to government revenue had declined to about 60 per cent, while the debt-to-GDP ratio had fallen to 38.8 per cent, which he described as acceptable by global standards.

He also said government revenues rose by 34.7 per cent in the first half of 2025, showing signs of fiscal improvement.

Edun acknowledged Nigeria’s shared struggles with other West African nations, including high debt service costs, limited revenue streams, and increasing pressure on public spending.

He argued that Nigeria was making a positive turnaround, with reforms boosting investor confidence, reducing fuel import expenses, enhancing energy independence, and encouraging local value addition.

He credited these gains to difficult but necessary reforms, including the removal of fuel subsidies, exchange rate liberalisation, and a broad tax reform initiative aimed at improving compliance and gradually increasing the tax-to-GDP ratio.

According to Edun, these reforms are laying the groundwork for a stable macroeconomic climate that encourages private sector investment, which constitutes around 90 per cent of the nation’s economy.

He stressed that the government’s borrowing was now targeted at specific projects that generate returns, and said the administration was avoiding inflationary practices like excessive money-printing or unsustainable financing methods.

Edun also pointed to global challenges such as declining development aid, shrinking global trade, and higher international interest rates, which he said complicate fiscal management in developing nations.

He argued that these global constraints make it even more critical for African countries to embrace reforms, digital innovation, and technology-driven revenue systems to boost domestic income.

The minister maintained that parliamentary scrutiny is vital for upholding fiscal responsibility and further urged lawmakers to actively hold the executive accountable for borrowing and spending decisions, asserting that transparency and accountability must form the backbone of fiscal policy.

“A credible fiscal plan isn’t just an executive responsibility, it requires strong collaboration and oversight, especially from finance and public accounts committees like yours.”

He described Nigeria’s current fiscal path as a key inflection point, where recent reforms are paving the way for long-term stability, global competitiveness, and inclusive development.

Edun however concluded by stressing the importance of responsible borrowing, clear reporting, and vigilant legislative oversight to secure the country’s financial future.

The President of the senate, Godswill Akpabio, called for stronger legal frameworks across West Africa to empower finance and public accounts committees, ensuring better debt transparency and sustainability.

Represented by Senator Osita Izunaso, Akpabio warned that unchecked borrowing could endanger citizens’ futures and weaken democratic institutions throughout the region.

He argued that sound debt management, underpinned by rigorous oversight can be a powerful tool to finance infrastructure, spur growth, and support sustainable development.

The House Public Accounts Committee Chairman, Hon. Bamidele Salam, revealed that his committee had recovered more than N200 billion in lost government revenue over the past year.

Salam said these recoveries were part of ongoing reforms to improve financial accountability in Nigeria.

He noted that this WAAPAC meeting which Nigeria is hosting for the first time since the group’s founding in 2009 is particularly timely in light of Africa’s escalating debt crisis.

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