“IMF-Debt-Free” ~ A Smoke Screen: Nigeria Borrowing More, Seeing Less.

By George Omagbemi Sylvester | Published by SaharaWeeklyNG.com

When jokers on stage tell you they have no debt, look in their pockets first!

The Nigerian government today pushes the “IMF-Debt-Free” narrative with all the confidence of a stage magician who expects applause while hiding his sleeves full of tricks. Meanwhile, the numbers tell a far different story. Nigeria has become one of the largest debtors to the World Bank’s IDA (International Development Association) and borrowing continues to climb, often with little clarity on what is being borrowed for or how the debt will be repaid.

If I go die and tell you that someone is shouting “DEBT-FREE” while owing over US$18.2 billion to IDA as of June 30, 2025; yes, that’s Nigeria’s position, confirmed.

Under the Tinubu administration, exposure to World Bank/IDA loans rose from US$14.3 billion in mid-2023 to US$16.5 billion by mid-2024, a 14.4% increase.

This is not mere borrowing; this is a debt spiral. What is Mr President doing about this? So far, the response is murky at best:

The Facts: What We Know. World Bank IDA Debt Exposures: As of 30 June 2024, Nigeria owed roughly US$16.5 billion to IDA.

This put Nigeria as the 3rd largest debtor to IDA, behind Bangladesh and Pakistan.

External Debt Rising:
Nigeria’s external debt stock is increasing, both via multilateral sources (e.g. World Bank, IDA) and bilateral/multilateral loans. The exact terms, the projects financed, and the repayments are often opaque.

Total Public Debt:
As of early 2024, total public debt (external + domestic) was already huge: the Debt Management Office (DMO) reported public debt at N121.67 trillion (approx. US$ values depending on exchange) in Q1 2024. Domestic debt and external debt both contribute heavily.

Borrowing for Recurrent Obligation, Not Always Capital Projects:
There are concerns that many of the loans end up servicing recurrent expenditures or simply funding budget deficits, rather than in long-term infrastructure, education, health etc., which can generate returns. Citizens see little tangible improvement in basic services. This raises repayment risks. (Critiques by opposition figures like Peter Obi highlight this.)

What They Say They Are Doing (And Why It Does not Add Up)
Claim: Nigeria is “debt-free” or “IMF-debt-free.”
Reality: Nigerian governments repeatedly emphasise that they have repaid some IMF obligations (for example, COVID related funds) but being “IMF-debt-free” doesn’t equal being debt free, especially when borrowing from World Bank, bilateral creditors, multilateral lenders etc continues. For example, SaharaWeeklyNG.com confirms Nigeria repaid US$3.4 billion owed to the IMF for COVID financing. That’s good; but the bigger debts remain.

Claim: Borrowing is targeted, prudent and for necessary reforms.
Reality: While some funds are approved for health, education, power, irrigation etc. (World Bank approvals like US$1.57 billion for such sectors have been reported), the scale of the debt service, the rising amount and the lack of visible impact on living standards, infrastructure and basic public goods suggests something is very wrong with oversight, prioritization or execution.

Claim: Accountability mechanisms exist.
Reality: There is often insufficient disclosure of what exactly loans are used for, how contractors are selected, what time frames are, whether projects get completed or whether citizens actually benefit. When citizens ask questions, the answers are often vague. Comedian Gordon would joke that “they borrow money like they are shopping on Black Friday, but nobody sees the shopping bags.” Edo Pikin might say “this kind borrowing na tax for unborn children.” These are jokes, but they sting because they carry truth.

Expert Voices: What the Scholars & Economists Warn. Dr. Ngozi Okonjo-Iweala (WTO Director-General, former Finance Minister) has repeatedly warned about the risk of rising debt profiles in Nigeria and states. She has said:

“Watch your debt profiles and keep careful control of expenditures. You must share with your state citizens how much FAAC allocation you receive each month, how much IGR you collect and how you spend it.”

Also:
“There should be full transparency on debt, especially those owed by state enterprises.”

Joseph Stiglitz has warned more broadly (regarding Africa) that:

“The difficulty of coordination between diverse creditors (makes debt restructuring more difficult. We have no framework for debt restructuring across sovereigns) too little debt restructuring, too late.”

Dambisa Moyo (economist, author of Dead Aid) has long argued that constant dependence on external loans or aid without demanding accountability leads to debt burdens that undermine economic sovereignty and sustainable growth. Her critiques remain relevant.

Why the “Debt-Free” Narrative Is Dangerous
Misleading the Public: Telling citizens the country is debt free or reducing emphasis on debt obligations while borrowing more fosters complacency. People believe the crisis is over or being handled, when in fact the structure of public debt is becoming more fragile.

Interest & Exchange Rate Risks: Much external debt is denominated in foreign currencies. With naira depreciation, servicing becomes more expensive in local currency. Inflation erodes purchasing power. When citizens see high inflation, energy shortages, failing hospitals etc., these are often downstream symptoms of macro mismanagement tied in part to heavy debt servicing.

Crowding Out Development Spending: When a large portion of government revenue goes to servicing debt rather than investing in health, education, infrastructure, or security, the country cannot improve its human development indicators. Citizens may be worse off than before.

Future Generational Burden: Borrowing without clear repayment plans or investment in productive assets passes the burden to future Nigerians. The debt becomes intergenerational.

What Mr. President Should Be Doing Instead. Full Transparency: Publish all loan agreements, including terms, interest rates, grace periods, repayment schedules. Make accessible by citizens, civil society, experts. Let the budget debates include “where this money is going” lines.

Prioritise Productive Borrowing: Loans should flow mainly into projects with high returns (roads, power, education) not recurrent (salary) demands, subsidies without reform or conditioning foreign debts for vanity projects.

Debt Audits & Independent Oversight: Set up independent audits of existing debt; let an institution (parliament, civil society, or an auditor) verify that funds are used, projects completed and that terms are not predatory.

Build Domestic Resource Mobilisation: Increase tax collection efficiency, reduce leakages, broaden the tax base, improve non-oil revenue. Less dependency on external debt.

Negotiate Better Terms: When borrowing is necessary, aim for concessional terms, long grace periods, low interest rates and ensure borrowing does not push debt service beyond manageable percentages of revenue.

Public Education & Accountability: Citizens must know what borrowing means. Civil society, comedians, satirists (yes, I Go Dye, Gordons, Edo Pikin) have a role: mock the hypocrisy, demand answers.

The Verdict:
Nigeria cannot continue pretending that “IMF-Debt-Free” is the badge of economic sobriety while amassing tens of billions in debt to other multilateral lenders, bilaterals and external creditors. Borrowing is not evil; RECKLESS, OPAQUE and UNJUSTIFIED BORROWING is what must be CONDEMNED.

If I go die and tell you, we must treat debt like we treat fire: when it’s small, manage it. When it becomes a blaze, stop pretending it’s smoke. When we have approval for more loans, we must insist on seeing exactly what is being borrowed into.

In 2027, Nigerians must demand that our government stops theatrics, opens its books and addresses the debt monster before it devours hope. As Edo Pikin might say: “no more borrowing masquerading as development,” and as Gordons would crack: “if you no fit carry your pocket, how you wan carry suitcase?”