Obi to Tinubu: Borrowing for consumption is ‘killer cancer’

A former presidential candidate, Peter Obi, has criticised Nigeria’s borrowing pattern, warning that debt accumulated without productive investment could harm the country’s economic future.

In a statement posted on his X account on Wednesday, Obi described borrowing for consumption rather than production as dangerous, likening it to a “killer cancer” that erodes a nation’s economic health.

“Borrowing is not only a leprosy, but a killer cancer when it is borrowed for consumption and not production as it is in Nigeria today,” he said.

Obi argued that one of Nigeria’s major challenges is not just rising debt, but borrowing that is not tied to measurable economic value, job creation, or improved living standards.

“Debt that is not tied to measurable economic value. Debt that does not translate into jobs, growth, or improved living standards for the Nigerian people,” he added.

He stressed that responsible economies borrow with discipline and clear repayment plans linked to productive investments, noting that Nigeria’s approach falls short of these standards.

Citing the Fiscal Responsibility Act 2007, Obi said the law requires that any borrowing must specify its purpose and include a cost-benefit analysis outlining economic and social benefits.

According to him, many of the government’s loans do not meet these legal and economic requirements.

“Most of the borrowings by this government do not satisfy the requirements of law or the requirements of economic common sense,” he said.

Obi further expressed concern over Nigeria’s high debt servicing burden, noting that it constrains the government’s ability to invest in key sectors that drive development.

“What matters is not debt-GDP as much as debt-debt servicing ratio because the latter constrains our capacity to finance the sectors that drive human development and economic growth,” he stated.

He warned that borrowing for non-productive purposes creates a “double jeopardy,” where current revenues are used to service debts that do not enhance future economic capacity.

Obi called on the government to adopt a more transparent and accountable approach to borrowing, insisting that loans must be justified and made to work for the benefit of citizens.

“A responsible government does not merely defend borrowing; it explains it, justifies it, and most importantly, ensures it works for the people,” he said.

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