The Emir of Kano, Muhammadu Sanusi II, has raised concerns over Nigeria’s continued borrowing despite the removal of petrol subsidy, questioning the Federal Government’s fiscal direction.
Speaking in an interview published by News Central TV on Friday, the former Governor of the Central Bank of Nigeria acknowledged that key reforms—such as subsidy removal and exchange rate liberalisation—were necessary but warned that poor sequencing and weak fiscal discipline could erode their benefits.
Sanusi criticised Nigeria’s past dependence on imported petroleum products, describing it as a structural failure.
“I have always said the subsidy regime was unsustainable. We cannot continue supporting foreign refineries. We’re an oil-producing country. Keeping refineries open abroad while we’re not doing our own,” Sanusi said.
He, however, welcomed recent progress in domestic refining, noting a shift in the country’s petroleum trade balance.
“Today, we have a situation where we have our own domestic refinery. We’re not importing petroleum products. We’re even exporting to Europe, and this is very good for the economy,” he added.
While endorsing the reforms in principle, Sanusi questioned their timing and implementation strategy, suggesting that additional supporting measures were overlooked.
“For me, removing subsidy or liberalising exchange rates, these are good interventions. Were they done at the right time? Those are certain questions. Were there other things that should be done that have not been done? These are other issues.”
He argued that implementing exchange rate liberalisation in a loose monetary environment contributed to the naira’s sharp depreciation.
“It’s not enough to say, oh, they removed subsidy. You had to. When you get to a point where 100% of your revenue goes into debt service, you cannot continue. Where is the money going to come from?
“However, if you decide to remove subsidy and liberalise exchange rates in an environment of very loose monetary conditions, before you have tightened money supply, the Naira drops to a bottomless pit. That was a timing issue.”
Sanusi further questioned why the government continues to borrow despite eliminating subsidy payments, calling for visible fiscal consolidation.
“We’ve removed the subsidy. We’re now spending it. What we should not see is fiscal consolidation. You cannot remove wastages and continue borrowing. I’ve said this before. You need to see the benefits.
“If you’re not paying the subsidy and you’ve got the money, why are we still borrowing and borrowing? What are we borrowing for?” Sanusi questioned.
His comments come amid growing concerns about Nigeria’s rising debt profile. Recent reports indicate that the Federal Government increased its 2026 borrowing plan by ₦11.31 trillion, bringing the total to ₦29.20 trillion.
Additionally, President Bola Tinubu has sought Senate approval for a fresh $516 million external loan to finance sections of the Sokoto–Badagry Superhighway.
Sanusi’s remarks add to ongoing debates among policymakers and economists over the sustainability of Nigeria’s fiscal strategy and the long-term impact of ongoing economic reforms.
