Tinubu Declares End to Domestic Borrowing

President Bola Ahmed Tinubu has announced that the Federal Government is no longer borrowing from local banks, describing the move as a sign of Nigeria’s growing economic stability and stronger revenue performance. This declaration marks a significant milestone in the administration’s efforts to restore fiscal discipline and reduce dependence on borrowing to fund government activities.

The President made the announcement during a meeting at the Presidential Villa with members of the Buhari Organisation, a group led by former Nasarawa State Governor, Senator Tanko Al-Makura. Addressing the delegation, Tinubu revealed that Nigeria had already met its revenue target for the entire year by August 2025. He attributed the achievement to improved performance in the non-oil sectors of the economy, which he said have been driving government income at a pace not seen in recent years.

“The economy is stabilised. Nobody is trading pieces of paper for exchange rate anymore. We are going up,” Tinubu stated. “Today, I can proudly say Nigeria is not borrowing a dime from local banks. We set a revenue target for the year, and by August, we already achieved it. Non-oil revenue has been strong, and as long as that continues, we have no reason to fear.”

His remarks highlighted the administration’s push to diversify Nigeria’s economic base away from oil, which has historically accounted for the majority of government revenue. For years, fluctuations in global oil prices have left Nigeria vulnerable to economic shocks. Tinubu’s emphasis on non-oil revenue suggests that sectors such as agriculture, trade, and services are beginning to play a more significant role in financing the government’s spendings

In addition to the revenue breakthrough, President Tinubu announced a major agricultural mechanization initiative, which he described as central to his administration’s plans for food security and poverty reduction. The initiative aims to establish mechanized agricultural centers in every region of the country. These centers are expected to provide farmers with access to modern equipment and practices, thereby boosting productivity and reducing Nigeria’s reliance on food imports.

“I’ve just approved a huge mechanization program. In every region of the country, there will be a mechanized center for agriculture. That is our path to food sovereignty and food security,” Tinubu explained. “If you remove hunger from poverty, you have defeated poverty. That is the direction we are going.”

The initiative ties into Tinubu’s broader vision of achieving economic resilience through self-sufficiency in food production. By reducing the nation’s dependence on imported food and empowering local farmers with the tools they need to scale production, the government hopes to not only tackle hunger but also create jobs and stimulate rural development.

Despite the President’s upbeat outlook, concerns remain about Nigeria’s debt profile. According to data from the Debt Management Office (DMO), Nigeria’s total public debt as of March 31, 2025, stood at N149.39 trillion. This figure represented a 22.8 percent increase compared to the N121.67 trillion recorded in the same period of 2024. On a quarterly basis, the debt also rose by N4.72 trillion compared to the previous quarter.

This rising debt trend has prompted warnings from economists and market analysts. CSL Stockbrokers Limited, a subsidiary of FCMB Group Plc, recently released a mid-year economic outlook that projected Nigeria’s debt could climb to N160.6 trillion by the end of the year. According to the report, the Federal Government may still need to borrow as much as N9.3 trillion in the second half of 2025 to bridge a growing fiscal deficit.

If this borrowing occurs, Nigeria’s debt-to-GDP ratio could reach about 50.2 percent of the pre-rebased GDP, well above the government’s own target. The analysts also warned that the fiscal deficit could expand to 5.8 percent of GDP, surpassing the official budget projection of 3.9 percent.

The contradiction between President Tinubu’s declaration of fiscal progress and the growing concerns highlighted by independent analysts reflects the complexity of Nigeria’s current economic situation. On the one hand, the administration’s claim of exceeding revenue targets is a positive signal that reforms and diversification efforts are yielding results. On the other hand, the sheer size of the nation’s debt raises questions about the sustainability of the government’s fiscal strategy.

Part of the concern lies in weak oil earnings. Although the government is prioritizing non-oil revenue, oil still plays a significant role in Nigeria’s foreign exchange earnings. Declining oil production, combined with volatile global prices, means the country cannot completely rely on oil revenues to stabilize its economy. In addition, delays in implementing comprehensive tax reforms mean the government’s ability to broaden its tax base and capture more revenue from the formal and informal sectors remains limited.

For now, the administration continues to project confidence. Tinubu’s insistence that Nigeria no longer relies on domestic banks for borrowing may indicate a shift toward external financing or a stronger reliance on revenue growth to cover expenditure. However, fiscal watchers are not convinced that borrowing will be completely eliminated. Instead, they caution that the government must adopt prudent debt management practices while also improving the efficiency of revenue collection.

As Nigeria moves into the final months of 2025, the debate over the country’s fiscal health is likely to intensify. Tinubu’s government is eager to show progress and present itself as fiscally disciplined, especially as it seeks to build investor confidence and reassure citizens weary of economic hardship. Achieving this balance will require not just declarations of success but concrete policies that ensure sustained revenue growth, efficient spending, and a credible plan to manage the nation’s rising debt.

The agricultural mechanization program offers a glimpse into how the administration hopes to address the root causes of poverty and food insecurity, while the revenue surge demonstrates that diversification is possible. Still, the figures from the Debt Management Office serve as a reminder that Nigeria’s fiscal journey is far from over.

If Tinubu’s optimism is to be matched by economic reality, his administration will need to continue pushing reforms, strengthen institutions, and maintain transparency in how public resources are managed. Only then can Nigerians truly feel the benefits of a stabilised economy that does not rely on borrowing to survive.