Peter Obi, a chieftain of the African Democratic Congress and 2023 presidential candidate of the Labour Party, has warned that borrowing for consumption rather than production is destroying Nigeria’s economic future.
Obi said while borrowing itself is not entirely wrong, it becomes dangerous when loans are not tied to productive sectors capable of generating jobs, growth and improved living standards for citizens.
According to him, borrowing for consumption is not only “a leprosy” but also “a killer cancer” because it gradually weakens the health, reputation and independence of any nation.
He said one of Nigeria’s major economic problems today is not merely rising debt, but debt accumulated without measurable productivity or economic returns.
The former Anambra governor noted that no serious economy borrows recklessly, stressing that nations only borrow with discipline, clear purpose and realistic repayment plans tied to productive investments.
Obi cited the Fiscal Responsibility Act 2007, which requires any government or agency seeking loans to clearly state the purpose of borrowing and provide cost-benefit analysis showing economic and social gains.
He said such analysis must demonstrate how the loans would boost economic growth and improve the welfare of Nigerians in measurable terms.
Obi argued that most of the borrowings undertaken by the present administration of President Bola Tinubu fail both the legal test and the test of economic common sense, insisting that many of the loans do not show how they would expand Nigeria’s productive capacity.
He further warned that the country’s high debt servicing burden now threatens future development, as government revenues are increasingly used to repay loans instead of funding education, healthcare and infrastructure.
“A responsible government does not merely defend borrowing; it explains it, justifies it, and most importantly, ensures it works for the people,” Obi said.
Recall that President Bola Tinubu had said recently that borrowing by the Federal Government is not leprosy,
