Former President Olusegun Obasanjo has warned that Nigeria's rising government debt poses a threat to future generations, directly challenging President Bola Tinubu's position that borrowing is acceptable if the state has the capacity to repay. Obasanjo made the comments on Friday at the Ajibosin Platform, a public forum in Abeokuta, Ogun State. He described debt as more damaging than leprosy, saying that while leprosy damages only one person, debt destroys generations. His remarks came days after Tinubu requested National Assembly approval for additional external loans totalling $20.52bn and €1.045bn under the Federal Government's 2026-2027 Supplementary External Borrowing Plan.
The proposed fresh borrowing is intended to finance projects in infrastructure, agriculture, healthcare, education, water supply, security, employment generation and financial management reforms. Tinubu justified the additional external financing as necessary to address Nigeria's infrastructure deficit and bridge funding gaps affecting development projects. The request was referred to the Senate Committee on Local and Foreign Debts for consideration.
Obasanjo's comments represent a direct response to Tinubu's earlier defence of his administration's borrowing policy in April. At that time, the President said borrowing was not inherently harmful. "If we have to borrow, we borrow. Borrowing is not leprosy, we just have to work hard to be able to pay for it," Tinubu stated during a meeting with Plateau State leaders.
The former President also raised broader concerns about Nigeria's economic trajectory and currency depreciation. He noted that 47 years ago, when he established his farm, the naira exchanged at N1 to $1.85 against the dollar. He questioned what the country had accomplished in that period, given that the exchange rate now stands at approximately 1,500 naira to the dollar. Obasanjo expressed doubts about Nigeria's political leaders' knowledge and capacity to address the country's challenges and improve citizens' welfare.
Obasanjo further questioned Nigeria's reliance on the World Bank and the International Monetary Fund, noting that these institutions were established before Nigeria's independence and were not designed by or for Nigerians. He cautioned that depending on external economic policies without adequately considering Nigeria's specific circumstances could be counterproductive. He argued that the country should develop approaches that reflect its own needs and realities.