Peter Obi, a former Governor of Anambra State, has expressed worries over Nigeria’s continued rise in external debt following recent World Bank data placing the country as its third-largest debtor at an estimated $18.7 billion.
Obi, in a post on the microblogging platform X on Tuesday monitored by news.ng, noted that while Bangladesh is the World Bank’s biggest borrower at about $23 billion, there is nothing wrong with borrowing if it is used productively.
“Recent World Bank reports indicate that Nigeria is now its number 3 debtor, with obligations estimated at roughly $18.7 billion. Bangladesh is the number one with $23 billion.
“I continue to emphasise that there’s nothing inherently wrong with borrowing. Nations borrow to improve productivity and stimulate growth. Debt becomes a problem only when it finances consumption, inefficiency, or corruption rather than investment, as is our own case,” he stated.
Citing Bangladesh, Obi, the Labour Party (LP) 2023 presidential candidate, said the Asian country’s economy has improved significantly because funds were used in productive sectors.
He, therefore, urged the federal government to channel loans from financial institutions into productive sectors, including manufacturing and energy, and to invest in human capital development, which guarantees a return on investment.
“To understand the difference, it is useful to compare outcomes. Around 2015, Bangladesh’s nominal GDP stood at roughly $195 billion, with per-capita income slightly above $1,235. By 2024–2025, its economy had expanded to roughly $460–500 billion, and per-capita income had risen to about $2,700. In a decade, Bangladesh more than doubled the size of its economy, lifted incomes, and strengthened its export base – evidence that borrowed resources were largely channelled into productive sectors such as manufacturing, textiles, energy, and human capital,” Obi said.
Obi gave a classic example of how Nigeria’s economy has declined since 2015 when the country’s Gross Domestic Product (GDP) was about $490 billion. The decline, according to the former governor, was due to weak productivity and mismanagement of funds, which reduced the GDP to about $250 billion.
“Nigeria’s trajectory over the same period tells a different story. In 2015, Nigeria’s GDP was about $490 billion, with per-capita income around $2,600–2,700. Today, due to weak productivity growth, currency instability, structural inefficiencies, and monumental corruption, Nigeria’s GDP is below about $250 billion, with a per-capita income of $850-1000. Instead of expanding as is the case with Bangladesh, the economy has effectively contracted,” he said.
“The contrast is instructive. One country borrowed and expanded production, exports, and incomes. The other borrowed but saw declining economic strength and living standards. This suggests that the real issue is not the size of borrowing, but the use of borrowed funds. Debt tied to infrastructure, industry, and human development fuels growth. Debt tied to consumption, leakages, and corruption deepens stagnation,” Obi added.
In his conclusion, Obi, who has officially signified interest in running for the 2026 presidential election, said hope is on the horizon if loans are channelled towards productivity.
“A new Nigeria where loans, if taken, will translate into productivity instead of consumption, is very much possible,” he stated.
