The Labour Party’s 2023 presidential candidate, Peter Obi, has once again raised the alarm over Nigeria’s ballooning debt profile, warning that the nation is trapped in a “debt without growth” cycle.
In a scathing assessment shared via X (formerly Twitter), Obi contrasted Nigeria’s economic stagnation with the rapid ascent of Bangladesh, arguing that while both nations are top borrowers, only one has the results to show for it.
The IDA Debt Trap
Referencing recent World Bank data, Obi pointed out that Nigeria has climbed the ranks to become the third-largest debtor to the International Development Association (IDA), with an outstanding debt of approximately $18.7 billion.
While Bangladesh leads the pack with roughly $23 billion in IDA debt, Obi noted the fundamental difference lies in how the money is utilized.
“There’s nothing inherently wrong with borrowing. Nations borrow to improve productivity and stimulate growth,” Obi stated. “Debt becomes a problem only when it finances consumption, inefficiency, or corruption rather than investment.”
The Tale of Two Economies: 2015 vs. 2026
Obi provided a sobering statistical breakdown comparing the trajectories of both nations over the last decade:
- Bangladesh: Since 2015, its GDP has surged from $195 billion to nearly $500 billion, with per-capita income hitting $2,700.
- Nigeria: In 2015, Nigeria’s GDP was roughly $490 billion with a per-capita income of $2,600. Today, the GDP has plummeted to below $250 billion, while per-capita income has crashed to between $850 and $1,000.
The former Anambra Governor blamed this “drastic reversal of fortunes” on structural inefficiencies, currency instability, and “pervasive corruption.”
A Warning on the 2026 Budget
With Nigeria’s IDA debt growing by 11% ($1.9 billion) in just the last year, Obi cautioned that the federal government’s plan to borrow nearly ₦18 trillion for the 2026 budget could further stifle the economy. He warned that high debt-servicing costs are currently “crowding out” essential spending on health and education.
Despite the grim outlook, Obi maintained a glimmer of hope for a policy shift.
“A new Nigeria where loans, if taken, will translate into productivity instead of consumption is very much possible,” he concluded, urging leaders to prioritize accountability and strategic investment.
