The Emir of Kano and former Central Bank Governor, Muhammadu Sanusi II, has questioned the Federal Government’s continued borrowing despite the removal of petrol subsidy and the liberalisation of the foreign exchange market.
Speaking during an interview aired by News Central TV, Sanusi said while the removal of fuel subsidy and exchange rate liberalisation were necessary economic reforms, poor timing and lack of fiscal discipline may wipe out their intended benefits.
According to him, Nigeria could not continue sustaining a subsidy regime that mainly benefited foreign refineries while the country’s own refining capacity remained inactive.
“I have always said the subsidy regime was unsustainable. We cannot continue supporting foreign refineries. We’re an oil-producing country,” Sanusi stated.
He expressed optimism over Nigeria’s shift toward domestic refining, noting that the country now has operational local refining capacity and is moving from being a major importer of petroleum products to an exporter.
“Today, 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.
However, Sanusi raised strong concerns about how the reforms were implemented, arguing that liberalising the exchange rate in an environment of loose monetary policy worsened the naira’s depreciation.
He explained that removing subsidy and floating the naira without first tightening money supply created a situation where the currency fell sharply, describing it as a major timing issue.
The former apex bank chief also questioned why the government continues to borrow heavily after claiming savings from subsidy removal.
“We’ve removed the subsidy. 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?” he asked.
His remarks come as the Federal Government reportedly increased its 2026 borrowing plan by over ₦11 trillion, bringing total projected borrowing to ₦29.20 trillion, while President Bola Ahmed Tinubu also sought Senate approval for a fresh $516 million loan for the Sokoto-Badagry Superhighway project.
Sanusi’s comments have reignited national debate over Nigeria’s debt profile, fiscal discipline, and whether citizens are truly benefiting from the painful economic reforms introduced by the current administration.
