The 16th Emir of Kano, Muhammadu Sanusi II has challenge the Federal Government’s continued borrowing despite eliminating petrol subsidy payments.
“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.”
He stated this on Thursday at TheNiche 2026 annual lecture, themed ‘Governing the Economy: Choices, Trade-offs, and National Priorities’, held in Lagos.
Sanusi spoke at a time President Bola Tinubu is seeking a fresh $516 million borrowing requestfrom the National Assembly for the construction of sections of the Sokoto-Badagry superhighway project,
In March, the National Assembly approved Tinubu’s $6 billion external borrowing request, intended to be used partly for debt settlement.
the former Governor of the Central Bank of Nigeria, stated that while the removal of fuel subsidy and the liberalisation of the exchange rate were necessary, the timing and lack of fiscal discipline are threatening to erase the potential benefits.
According to the monarch, Nigeria’s practice of supporting foreign refineries while its domestic refining capacity remained dormant was a systemic failure that needed to be addressed.
“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, expressed optimism over the current shift toward domestic production, noting that the country has moved from a heavy importer of petroleum products to an exporter.
“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 backing the policy shifts, the traditional ruler raised concerns over the timing and the sequence of the reforms.
He said, “Artificial exchange rates, especially when you’re printing money, cannot work. There was going to be a devaluation.
“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 liberalising the exchange rate in a “loose monetary environment” contributed to the currency’s rapid 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?“
