Emir of Kano Criticizes Federal Government’s Borrowing Practices
The 16th Emir of Kano, Muhammadu Sanusi II, has expressed concerns about the federal government’s continued reliance on borrowing, even after the removal of petrol subsidies. As a former governor of the Central Bank of Nigeria (CBN), Sanusi highlighted what he sees as a systemic failure in Nigeria’s approach to energy and economic management.
During an interview on News Central TV, Sanusi pointed out that while the government is spending heavily on foreign refineries, domestic refining capacity remains underutilized. He argued that this imbalance reflects poor policy decisions and needs urgent attention.
His comments come at a time when President Bola Tinubu has requested the Senate to approve a $516.3 million loan for the Sokoto-Badagry Superhighway, a project aimed at connecting Nigeria’s North-West and South-West regions. The proposal has sparked debate, with critics questioning whether the funds could be sourced differently.
A Longstanding Critique
This is not the first time Sanusi has voiced his concerns about Nigeria’s borrowing habits. In October 2025, he criticized the administration for continuing to borrow despite the removal of petrol subsidies, a move expected to improve government revenue. At the Oxford Global Think Tank Leadership Conference, he questioned the logic behind such borrowing, stating that the government should have more fiscal space after ending the costly fuel subsidy regime.
Sanusi emphasized that stopping subsidies while increasing debt creates a cycle of financial instability. “If you stop paying subsidies but continue borrowing more, it means you’ve filled one hole only to dig another,” he said. He also pointed out that the real challenge lies in the quality of government spending and how revenues are managed.
In 2012, Sanusi had warned that the subsidy was unsustainable, but political interests took precedence. “Now, the same people who led protests against it have inherited the problem and had no choice but to do the right thing,” he noted.
Questions About the Purpose of Borrowing
Reiterating his stance, Sanusi warned that weak fiscal discipline could undermine recent economic reforms. While acknowledging the potential benefits of the Sokoto-Badagry Superhighway, he raised questions about the necessity of borrowing for such projects.
“Why are we still borrowing and borrowing? What are we borrowing for?” he asked. Sanusi also highlighted the importance of aligning economic policies with the right timing and sequencing. He argued that removing subsidies and liberalizing the foreign exchange market were good interventions, but they were implemented in a loose monetary environment, which contributed to the sharp depreciation of the naira.
“The Naira drops to a bottomless pit when you liberalize the exchange rate in a loose monetary environment,” he explained. “It’s not enough to say, oh, they removed the subsidy. You had to. When you get to a point where 100% of your revenue goes into debt service, you cannot continue.”
Shifts in the Energy Sector
Despite his criticisms, Sanusi acknowledged recent progress in Nigeria’s energy sector. He noted that the country is beginning to shift from heavy reliance on imports to domestic refining and export. “Today, we have our own domestic refinery. We are no longer importing petroleum products; we are even exporting to Europe. That is positive for the economy,” he added.
However, he stressed that these improvements must be accompanied by better fiscal management. “You cannot remove wastages and continue borrowing,” he said. “If you’re not paying the subsidy and you’ve got the money, why are we still borrowing and borrowing?”
Conclusion
Sanusi’s critique underscores the need for a more disciplined approach to fiscal policy and economic reform. His concerns about the timing and sequencing of key interventions highlight the complexities of managing a transitioning economy. As Nigeria continues to navigate its path toward stability and growth, the lessons from past policies will be crucial in shaping future decisions.
