In the initial six months of their terms, 13 newly appointed state governors collectively borrowed a total of N226.8 billion from both domestic and external financial sources. This information was revealed through a report by Sunday HEADLINENEWS, indicating that an additional 16 state governors also augmented their states’ debt profiles by N509.3 billion. Of this amount, N243.95 billion was sourced domestically, while $298.5 million (equivalent to N265.37 billion based on the exchange rate of N889/$) was obtained externally, as reported by the Debt Management Office (DMO). This data is derived from the most recent sub-national debt reports provided by the DMO.
The sub-national debts are categorized into domestic borrowings from local creditors and external borrowings from international financial institutions such as the World Bank and the International Monetary Fund. The disclosed domestic and external debt figures were current as of December 30 and June 30, 2023, respectively. Notable states involved in this borrowing spree include Benue, Cross Rivers, Katsina, Niger, Plateau, Rivers, Zamfara, and the Federal Capital Territory. From domestic creditors, these states collectively secured N115.57 billion, while governors from Ebonyi, Kaduna, Kano, Niger, Plateau, Sokoto, Taraba, and Zamfara obtained $125.1 million (equivalent to N111.24 billion) from external sources.
Further examination of the data revealed specific loan amounts acquired by various states and governors. For instance, Governor Bassey Otu of Cross Rivers obtained the highest loan, receiving N16.2 billion from domestic sources and $57.95 million from foreign creditors between June and December 2023. Following closely, Katsina State saw its debt escalate by N36.93 billion, reaching N99.3 billion by December 2023. Additionally, Niger State’s domestic debt surged to N139.8 billion from N121.95 billion in June 2023. Other notable debt increments include Plateau at N16.32 billion, Rivers at N7.07 billion, Zamfara at N14.26 billion, and the Federal Capital Territory under the leadership of Nyesom Wike at N6.75 billion borrowed from domestic creditors. On the foreign debt front, Governor Francis Nwifuru of Ebonyi State accumulated an external debt of $37.54 million, while Governor Uba Sani of Kaduna State borrowed $17.69 million from external financiers. Similarly, other governors secured foreign loans including those from Kano, Niger, Plateau, Sokoto, Taraba, and Zamfara.
Despite earlier assurances from President Bola Tinubu’s administration regarding reducing borrowings to fund governmental expenses, recent developments indicate a persistence in this controversial policy despite increased revenue. In 2023, state governors received the highest allocations from the Federal Account Allocation Committee in at least seven years. This surge in FAAC allocations across federal, state, and local government levels followed the removal of petrol subsidies and currency reforms implemented by the Tinubu administration, resulting in a reported 40% income boost. Detailed analysis of the monthly 2023 FAAC allocations disclosed the highest allocations to sub-national and local government councils in September (N627.73 billion), followed by December (N610.5 billion), August (N555.75 billion), November (N533 billion), July (N514 billion), and October (N497.97 billion).
