Obi urges Nigeria to adopt South Africa’s transparent borrowing model

Politics

ABUJA, Nigeria (NPA) — Presidential candidate of Nigeria’s major opposition party, the Nigeria Democratic Congress (NDC), Mr Peter Obi, has urged the Federal Government to adopt a more transparent and accountable approach to public borrowing, citing South Africa’s recent management of a $1 billion loan as a model worth emulating.

In a statement on Thursday titled “Accountable Borrowing: The South Africa Example,” Obi said borrowing is not inherently problematic, noting that nations across the world rely on debt financing to fund development projects.

According to him, the real issue is whether borrowed funds are deployed transparently and used for projects that deliver measurable benefits to citizens.

Obi commended the South African government for publicly outlining the specific objectives of its recently secured $1 billion loan from the New Development Bank.

He noted that the funds were earmarked for clearly identifiable projects, including upgrading water supply systems, modernising sanitation infrastructure, improving electricity distribution and strengthening waste management services across major cities such as Johannesburg, Cape Town and Durban.

“This is what accountable borrowing should look like. The purpose is clear, the projects are identifiable, and the expected benefits to citizens are measurable,” Obi said.

He added that such investments directly improve living standards, enhance productivity and stimulate economic growth.

Drawing a comparison with Nigeria, Obi expressed concern over the country’s rising debt profile, arguing that the utilisation of borrowed funds is often not communicated clearly to the public.

According to him, Nigeria’s total public debt has risen significantly in recent years, increasing from about N87 trillion in 2023 to nearly N200 trillion.

“Despite this unprecedented accumulation of debt, Nigerians are often left without a clear and detailed account of how these borrowings are being deployed to improve critical sectors such as education, healthcare, power, security and infrastructure,” he said.

The former Anambra State governor stressed that every loan obtained on behalf of Nigerians should be tied to specific, productive investments capable of creating jobs, reducing poverty and generating economic value.

He said good governance requires transparency and accountability, adding that governments must be able to explain what was borrowed, where the funds were invested, and the outcomes achieved.

“The ordinary Nigerian should be able to see and feel the benefits of every debt incurred on their behalf,” he said.

Obi further argued that rising living costs, unemployment, insecurity and declining purchasing power have made fiscal discipline and prudent management of public resources more important than ever.

He maintained that every borrowing decision should be subjected to a simple test: whether it improves the lives of ordinary Nigerians.

“If that question cannot be convincingly answered, then we risk merely transferring today’s burdens to future generations,” Obi said.