The Emir of Kano, Muhammadu Sanusi II, has issued a strong warning over Nigeria’s fiscal direction, cautioning that continued borrowing in the aftermath of fuel subsidy removal could undermine the intended gains of ongoing economic reforms.
Sanusi spoke at the 5th annual lecture organised by TheNiche in Lagos.
He said the removal of fuel subsidies was expected to free up significant fiscal space. Still, he questioned why this has not translated into reduced borrowing or visible improvements in public welfare.
“We’ve removed the subsidy. We’re not spending it. What we should not see is fiscal contradictions. You cannot remove the subsidy and continue borrowing. 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?” the former Governor of the Central Bank of Nigeria (CBN) queried.
Sanusi’s comments come amid controversy over another loan request by President Bola Ahmed Tinubu, who had asked the Senate to approve a $516 million loan for sections of the proposed Sokoto–Badagry Superhighway.
In a letter read by Senate President Godswill Akpabio, the President had said the 1,000-kilometre project was intended to connect Nigeria’s North-West and South-West regions.
The borrowing plan has drawn criticism from several quarters, including former Vice-President Atiku Abubakar, who had described the project as commendable but urged the government to explore alternative funding options instead of increasing debt.
Speaking further, Sanusi stressed that reforms must go beyond policy announcements and deliver measurable outcomes that citizens can feel, warning that failure to do so could erode confidence in government.
Despite backing the policy direction, the former CBN governor questioned the sequencing and timing of the reforms, particularly the removal of subsidy and liberalisation of the foreign exchange market at same time.
According to him, Nigeria’s past reliance on fuel subsidies and artificial exchange rates created deep distortions, making economic adjustment inevitable. He, however, stressed that reforms must be complemented by discipline and coherence in implementation.
“I have always said the subsidy regime was unsustainable. We cannot continue exporting jobs to foreign refineries when we are an oil-producing country and not refining our own products,” Sanusi said.
Highlighting recent progress in domestic refining, he added, “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.”
Despite acknowledging the gains, the former CBN Governor warned that poor policy coordination had weakened the overall impact of the reforms.
“Artificial exchange rates, especially when you’re printing money, cannot work. There was going to be devaluation,” he said, noting that the eventual adjustment of the naira was unavoidable.
Sanusi argued that the sequencing of policy actions played a critical role in the volatility experienced in the foreign exchange market.
“If you decide to remove subsidies and liberalise exchange rates in an environment of very loose monetary conditions, before you tighten the money supply, the naira drops into a bottomless pit. That was a timing issue,” he stated.
He emphasised that monetary tightening should have preceded or at least accompanied the liberalisation process to prevent excessive pressure on the currency.
On the fiscal side, Sanusi said, “When you get to a point where 100 per cent of your revenue goes to debt service, you cannot continue. Where is the money going to come from?” he asked.
He also reiterated his long-held position on governance and ethics in public service.
“Public service is an honour. If you want to make money, go into business,” he said, pointing to industrialist Aliko Dangote as an example of wealth creation through private enterprise.
Also speaking at TheNiche lecture, Abia State Governor, Alex Otti, provided a broader political context for Nigeria’s economic challenges, linking them to decades of poor leadership choices and declining civic participation.
Otti argued that the country’s current economic hardships, including rising poverty, unemployment, and institutional decay, are the cumulative result of governance failures spanning over half a century.
“If you have behaved badly for over 60 years, it will take you time to correct yourself,” he said. “Our country has a great destiny, but whether that day will be in this decade or in the coming century or perhaps never will depend largely on what we do in the days and years that follow,” he said.
The governor warned that citizens’ disengagement from the political process had contributed significantly to poor governance outcomes.
“Staying away from the field of play only ensures continued deterioration,” he said, referring to declining voter turnout in recent elections.
He stressed that democracy requires active participation beyond Election Day, urging Nigerians to critically assess candidates and their economic philosophies.
“The crisis of unemployment, poverty, and the collapse of institutions cannot be separated from citizens’ disinterest in the political affairs of their communities,” Otti stated.
Reflecting on his administration in Abia State, Otti said leadership change could catalyse economic renewal. He pointed to improvements in infrastructure and growing investor confidence as evidence that governance choices matter.
“Investors respond not to emotions, but to hard facts. So, have you created the right environment? If you have not created the right environment, businesses will not come,” he said.
Looking ahead to the next electoral cycle, the governor underscored the stakes for ordinary Nigerians.
“This is the best time to take civic education seriously. Poverty and prosperity, employment and joblessness, security and anxiety, prudence and rascality will all be on the ballot in 2027,” he said.
Chuks Okocha and Sunday Ehigiator
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