The Debt Management Office (DMO) has issued a stern advisory to Nigeria's state governments, urging strict adherence to established borrowing laws and guidelines as they plan their finances for the coming year.
DMO Boss Stresses Mandatory Compliance
Speaking at a capacity-building workshop for state officials in Abuja, the Director-General of the DMO, Ms. Patience Oniha, emphasized that compliance with the Fiscal Responsibility Act and other relevant legislation is not optional for sub-national entities seeking loans. She stated that a poor grasp of these rules has historically been a major cause of delays in approving loan requests from states.
"There is no flexibility when it comes to the law. If it is in the law, you must comply," Oniha declared. She clarified that by law, all borrowing requests must be processed through the office of the Minister of Finance and the DMO itself.
Workshop Aims to Bridge Knowledge Gap
The workshop, which forms part of the DMO's ongoing efforts to enhance debt management literacy at the state level, was specifically designed to address these compliance challenges. This year's session saw expanded participation, with each state represented by between five and eight officials.
The training covered critical areas for sound fiscal management, including:
- Debt recording and sustainability analysis
- Medium-term debt management strategy formulation
- Approved borrowing procedures and legal requirements
Oniha explained that the programme is intended to help states understand the legal frameworks outlined not only in the Fiscal Responsibility Act but also in the DMO Act, the Investment and Securities Act, and the Nigerian Constitution. A proper understanding, she noted, would enable states to access crucial funds for development projects from institutions like the World Bank without unnecessary bureaucratic hold-ups.
Warning Comes Amid Record National Debt
This advisory from the debt office is particularly significant against the backdrop of Nigeria's escalating public debt profile. Recent data from the DMO revealed that the nation's total public debt hit a record N152.4 trillion as of June 30, 2025, under President Bola Tinubu's administration.
Furthermore, analysis indicates that the debt burden at the state level is also rising sharply. Reports show that about twelve Nigerian states are now among those with the highest debt per person, with two states carrying approximately N100,000 in debt per capita. This underscores the urgent need for disciplined and law-compliant borrowing practices to ensure long-term fiscal sustainability for both states and the federation.
