Oyedele: Collapse of Naira and non-fresh loans have pushed Nigeria’s debt above N140tn

…He says the debt increase of over N40tn resulted from the depreciation of Naira

…Explain to the Senate the ways and means of securitization of N33tn

Daud Olatunji

Finance Minister and Coordinating Minister for Economy, Taiwo Oyedele, on Monday said the sharp rise in Nigeria’s public debt from about N75tn to over N140tn under the administration of President Bola Tinubu was driven largely by the depreciation of the naira and accounting adjustments, not new loans as widely perceived.

Oyedele made this clarification while briefing the Senate Finance Committee on the state of the economy, dismissing claims that the Tinubu administration has borrowed an additional $80 trillion since he assumed office in May 2023.

The minister’s explanation came in response to concerns raised by Senator Adamu Aliero (Kebbi Central), who questioned reports that the federal government would significantly expand the country’s debt burden within two years.

According to Oyedele, a direct comparison between the debt stock inherited by the administration and the current figure, without taking into account the effects of exchange rate depreciation, presents a misleading picture of the nation’s fiscal position.

He explained that the devaluation of the naira has significantly increased the naira value of Nigeria’s external debt, automatically inflating the country’s debt profile because public debt is reported in the local currency.

“When this administration came into office, the government debt was about $75 trillion. Many people simply compare this figure to today’s stock of debt and conclude that this government has borrowed massively,” Oyedele told lawmakers.

“Following the reforms and depreciation of the naira, the foreign currency component of our public debt has had to be revalued as Nigeria reports its debt in naira. This accounting adjustment alone has added more than 40 trillion naira to the public debt figure.”

The minister also attributed another major increase in debt to the securitization of Ways and Means advances inherited from the previous administration.

He said the exercise approved by the National Assembly added about N33tn to the official public debt, but stressed that it simply recognized existing liabilities rather than creating new ones.

“About $33tn was added to the public debt through this process. This was not new borrowing; it was simply bringing previously existing obligations onto the official debt books,” Oyedele explained.

He also clarified that much of the federal government’s domestic borrowing was undertaken to refinance maturing debts rather than to accumulate new liabilities.

“Previously borrowed debt matures and the government raises new debt to refinance it. This is not a new loan,” he added.

Oyedele argued that the Tinubu administration has adopted a cautious debt strategy focused on infrastructure development, economic expansion and debt sustainability.

According to him, any loan obtained from the government is expected to generate economic returns greater than its cost.

“We view debt as leverage. Every naira and dollar borrowed should generate more value than the amount borrowed,” he said, adding that the administration remained committed to prudent fiscal management.

Meanwhile, members of the Senate Finance Committee expressed dissatisfaction with the slow implementation of the capital component of the 2026 appropriations bill.

Senate Leader Senator Tahir Monguno (Borno North) described the pace of implementation as unacceptable, warning that failure to execute approved capital projects undermines legislative intent and public trust.

In response, the Chairman of the Senate Finance Committee, Senator Sani Musa, assured lawmakers that the Executive is taking steps to improve budget implementation.

Speaking after a closed-door meeting with the minister and members of the federal government’s economic team, Musa said discussions were underway to replace the current envelope budgeting system with a performance- and priority-based framework.

He also revealed that the government is reviewing the contractor payment process to eliminate bottlenecks and speed up the execution of capital projects across the country.

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