FG Urged to Adopt Anambra's Debt-Free Model for Economic Growth

The Alliance for Economic Research and Ethics, led by Hon. Dele Oye, has called on the federal government to reconsider its borrowing habits and instead, follow the example set by Anambra State. In a recent policy statement, Oye highlighted the dangers of Nigeria's increasing debt profile, which he believes poses a significant threat to the country's economic development. He pointed to Anambra's zero-borrowing policy, implemented by Governor Chukwuma Soludo, as a model worth emulating. According to Oye, the state's conservative approach to public finance has yielded positive results, with a significant increase in Internally Generated Revenue and investments in critical sectors such as healthcare, education, and infrastructure. In contrast, the federal government's reliance on borrowing has led to a substantial increase in the country's debt stock, with domestic debt standing at approximately N84.85 trillion and external debt at about N74.43 trillion. Oye expressed concern over the country's debt servicing obligations, citing the International Monetary Fund's projection that Nigeria will spend 53.7% of its federal revenue on debt servicing in 2026. This, he noted, is more than double the World Bank's recommended threshold of 22.5%. The AERE chairman also unveiled an eight-point policy framework aimed at transforming economic reforms into broad-based prosperity, emphasizing the need for a more disciplined fiscal management strategy. He argued that the country's current growth trajectory is unsustainable unless it directly improves the lives of ordinary citizens. Oye praised Governor Soludo for prioritizing long-term investments over recurrent expenditure, with about 77% of the state's 2024 and 2025 budgets devoted to capital projects. This approach, he said, has enabled the state to finance over 540 kilometers of road infrastructure and invest in healthcare and education without taking on new debt.