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The 16th Emir of Kano and former governor of the Central Bank of Nigeria (CBN) Muhammadu Sanusi II, has queried the rationale behind borrowings after the removal of petrol subsidy by the President Bola Ahmed Tinubu’s administration.
Speaking in Abuja yesterday at the Oxford Global Think Tank Leadership Conference and Book Launch, the emir said the removal of fuel subsidy had led to increased revenue.
Sanusi commended Tinubu’s administration for removing fuel subsidy and unifying exchange rates, describing both as “painful but necessary steps.”
He, however, cautioned that the reforms would fail unless matched with fiscal discipline and transparent spending.
“If you stop paying subsidies but continue borrowing more, it means you’ve filled one hole only to dig another. The real challenge now is the quality of government spending and the management of the revenues saved,” he said.
Sanusi, who served as CBN governor between 2009 and 2014, said Nigeria’s current economic woes were the consequence of years of policy inconsistency and populist politics.
“In 2012, we warned that the subsidy was unsustainable, but politics took over. Now, the same people who led protests against it have inherited the problem and had no choice but to do the right thing,” he said.
He applauded the professionalism of the current economic team for the steps taken to stabilise inflation and reduce exchange rate volatility, but insisted that government waste must be urgently curtailed.
Questioning the government expenditure, he asked: “Why do we need 48 ministers? Why do we need convoys of vehicles? Why are we still borrowing even after removing subsidies? If you fill one hole, why dig another?
“This government needs to look at institutions, transparency and how money is being used at all levels. Because if you keep earning more and spending badly, you’ll undo every gain made.
“We have too many sycophants in government. You sit in a meeting, and someone begins with, ‘Mr. President, I thank you for your leadership; God has blessed Nigeria by making you our leader.’ By the time they finish the praise-singing that is the advice the president takes.
“However, people like me that will say ‘Mr. President, this is wrong’ are branded enemies. So, when leaders surround themselves with praise-singers, they never get good advice.
“That is why people like Aigboje Aig-Imoukhuede and myself often end up being enemies of the state because people don’t like hearing bad news.
“We told Buhari everything — about printing money, waste, exchange rates, and subsidy— but each time, it was seen as a personal attack. Those around him convinced him we were enemies. Leaders must begin to ask: who do I surround myself with?
“And ministers should know — it’s not to your benefit to become a praise-singer. You debase yourself when you do that.”
Port Harcourt Refinery
Port Harcourt Refinery
‘Insecurity forced Jonathan to backtrack on subsidy removal’
Speaking on why the Jonathan government could not remove the fuel subsidy, Sanusi said: “The only reason the government compromised then was Boko Haram. There were thousands of Nigerians on the streets in Lagos, Kano, Kaduna and there were suicide bombers in the country. I told them, if one of these bombers explodes among protesters, we’d have 200 corpses; it won’t be about subsidy anymore.
“So, I must give President Jonathan credit. He was determined to do it, but at the end of the day, the compromise was made to save lives.”
Sanusi said that in 2012, “We were in a situation where we had what we called a hedge — not a subsidy. You see, a subsidy means the government pays a percentage of the price. But what we had was what, in risk management, you call a naked hedge, the worst possible derivative you can have. You will not pay more than X amount per litre of petrol, no matter what happens.
“So when oil prices rose from $40 to $140, the federal government paid the difference. When exchange rates moved from N155 to N300, the government paid the difference. When interest rates moved from 5 per cent to 15 per cent, the government paid the difference.
“All those costs — crude, refining, transportation, interest — were absorbed by the government. We moved from using revenues to pay subsidies, to borrowing money to pay subsidies, to borrowing money to pay interest on the borrowed money. We became bankrupt.
“Anyone who takes a naked hedge ends up bankrupt — especially when you don’t control the price of the commodity.
“Now, if Nigeria had allowed the Jonathan government to remove subsidy in 2011, that would have caused pain— but a very small fraction of what we face today. This is the cost of delay.
“At that time, we worked out the numbers in the Central Bank. I stood up and said: remove the subsidy today, inflation will move from 11 percent to 13 per cent, and I’ll bring it down within a year. We wouldn’t have had 30-something per cent inflation today.
“But people like my friend Kayode Fayemi and his APC colleagues came out on the streets — Occupy Nigeria, saying we couldn’t do it. I called one of my closest friends then and said, ‘You know what we’re doing is right.’ He said, ‘Yes, I know. But I’m in opposition. My job is to make the government look bad. You’re the CBN governor; go and defend your government.
“Now, what has the Central Bank achieved? Its role is to provide stability — not growth or employment — but a conducive environment for both.
“You don’t want inflation moving from 10 per cent to 15 per cent to 30 per cent. As I said recently at the NESG, Nigerians don’t realize we were on the brink of hyperinflation. Beyond a certain rate, it becomes uncontrollable — like Zimbabwe or Venezuela.
“We were printing money like mad and heading in that direction. But inflation has now been tamed, runaway devaluation stopped. Yes, the naira is at N1,400, but it’s better to know it will remain N1,400 for six months than to see it jump to N2,000 tomorrow.
“The Central Bank’s job is not to give you a ‘strong’ naira or low prices; its job is to reduce volatility. So, when you assess the bank, ask: have we reduced inflation volatility? Yes. Have we brought it down? We’re working toward single-digit inflation,” he said.
On the fiscal side, the emir said: “Tax reforms will kick in next year. But even before that, government revenues have increased, and debt-service ratios have dropped from over 100 per cent to about 40 per cent. The Finance Ministry deserves credit for that.”
Federal Ministry of Finance Abuja
Federal Ministry of Finance, Abuja
We’ll make reforms beneficial to poor Nigerians – Edun
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, reaffirmed the government’s commitment to ensuring that poor Nigerians enjoy the benefits of ongoing economic reforms.
He said the government had implemented a digital, transparent and accountable system to deliver direct financial support to 15 million households nationwide.
“Each beneficiary is identified by name and national identity number, and payments are made directly to bank accounts or mobile wallets,” Edun said.
According to the minister, the initiative allows the government to track disbursements in real time.
He said the government would soon publish data showing the names of beneficiaries who had received the first, second and third tranches of payments to reinforce transparency and public confidence in the programme.
Beyond the cash transfers, Edun disclosed that a ward-based development initiative was underway to channel resources, information and funding to all 8,809 wards across all the 774 local government areas.
“The programme will empower economically active people at the community level by supporting small businesses, cottage industries, and local entrepreneurs to boost production and create sustainable livelihoods,” he said.
The minister also noted that the reforms aim to stabilise the economy and “ensure that their benefits reach right down to the lowest levels of society.”
Also speaking, a former Director-General of the Securities and Exchange Commission (SEC) and founder of the Oxford Global Think Tank, Arunma Oteh, called for urgent measures to mobilize long-term capital, close the country’s infrastructure gap and decentralise the management of mineral resources to drive sustainable growth.
Oteh, who also served as a vice president at the World Bank, noted that Nigeria’s economic progress depends on its ability to attract “reasonably priced, patient, long-term capital” to support both the public and private sectors.
Citing international comparisons, she noted that while China invested about 24 per cent of its GDP in infrastructure, Nigeria allocated only 4–5 per cent, a ratio, which she said, must rise to at least 12 per cent of GDP to achieve meaningful progress.
“If we want to bridge our infrastructure gap, we must increase investment significantly,” Oteh stated.
She urged the Central Bank of Nigeria and the Ministry of Finance to scale up efforts to raise capital that supports small businesses and public infrastructure.
Jonathan lacked conviction to remove subsidy – Fayemi
A former governor of Ekiti State, Kayode Fayemi, alleged that former President Goodluck Jonathan lacked the conviction to remove the petrol subsidy in 2012.
Fayemi said contrary to the popular belief, most governors were in favour of subsidy removal during Jonathan’s administration, but the former president failed to stand by his own policy decision.
He said: “When we’re talking about the 2012 Occupy Nigeria and the opposition to President Jonathan, the truth of the matter was that the Nigerian Governors’ Forum, of which I was a member, was the major advocate of subsidy removal.
“Yes, my party, the Action Congress of Nigeria (ACN), did not support subsidy removal. In fact, myself and Adams Oshiomhole were active promoters of it in all of the town hall meetings held at the time.
“I think when people want to blame the opposition for not lining up behind President Jonathan, there is something to be said for President Jonathan lacking the conviction to go ahead and do what he believed in, and ensure that subsidy was removed,” he stated.
Fayemi, however, hailed President Bola Tinubu for demonstrating political courage by ending fuel subsidy immediately he assumed office in May 2023.
“What did President Tinubu do? He came in and said subsidy is gone from day one. He could have opted out of it, especially when the pressure started mounting in the first month and prices began to rise. But he stayed on course, and I think that is the courage we must commend him for,” Fayemi said.
He, however, noted that the greater challenge lies on how the petrol subsidy removal policy is managed to reduce the hardship faced by ordinary Nigerians.
Also speaking, Atedo Peterside, founder of Stanbic IBTC Bank, echoed Sanusi’s call for fiscal responsibility, saying government must demonstrate that savings from subsidy removal are being used to uplift ordinary Nigerians.
“It is not true that pain automatically brings gain. Gain only follows pain if the government spends wisely, eliminates waste and supports the poor,” he said.
2018 1large gas pipeline 5
2018 1large gas pipeline 5
Nigeria’s public debt stock
Nigeria’s total public deb stock stood at N152.39 trillion as of June 2025, according to the Debt Management Office (DMO).
The DMO has also stated that the public debt in dollar terms also rose to $99.68 billion just $400 million short of hitting $100 billion.
The rise reflects the fresh borrowings and the impact of appreciating exchange rate, especially on external debt obligations.
Nigeria’s creditors include China, France, Germany and Japan (bilateral debts) as well as multilateral institutions like the World Bank, Islamic Development Bank (IsDB) and the African Development Bank (AfDB).
The nation owes local bond creditors via sale of FGN Bonds, Treasury Bills, Sukuk Bonds, Green Bonds and Promissory Notes.
A breakdown of the debt profile shows that Nigeria has syndicated loans of N321.09 billion ($210 million)
These are short-term and medium-term facilities arranged by a group of banks, often led by institutions such as the Africa Finance Corporation. Other countries & promissory notes stand at N1.12 trillion ($735 million). These are negotiated instruments issued to settle verified obligations owed to local contractors, exporters, or foreign partners.
Nigeria also owes the African Development Bank Group N5.82 trillion ($3.80 billion), obtained from AfDB and its concessional arms — the African Development Fund (ADF) and Africa Growing Together Fund.
The country owes the World Bank Group N29.65 trillion ($19.39 billion). This comprises credits from the International Development Association (IDA) and the International Bank for Reconstruction and Development (IBRD).
This is just as the country has loans in Eurobonds worth N26.48 trillion ($17.32 billion) in Dollar-denominated sovereign bonds issued by Nigeria in international capital markets.
The largest share of the loan came from FGN Securities valued at N80.55 trillion ($52.68 billion). This includes core local debt instruments including FGN Bonds, Treasury Bills, Savings Bonds, Sukuk, Green Bonds, and Promissory
