President Muhammadu Buhari’s last budget of his second four year term has increased Nigeria’s spending to a post-independence high with the majority having to be borrowed. In his final year in office, Buhari is expected to nearly treble the country’s outstanding debt which has steadily increased since he took office in 2015.

The third largest item in the 2023 Budget will be debt service costs that increase by 71% which is a post-independence record. The main reason is the Federal Government’s plan to convert its stock of previously undeclared loans from the Central Bank of Nigeria (CBN) into bonds and add them to the country’s total outstanding debt.

Buhari has already requested legislative approval from the Senate to convert ₦22,300 billion (US$48.94 billion) in CBN loans into 40-year bonds.  Lawmakers have, however, queried the request to approve loans that were controversially taken from the CBN without their approval in the first place, and which appears to violate part of the legislation that first established the central bank. 

Buhari’s successor will certainly inherit a very challenging financial situation. According to Finance Minister Zainab Ahmed the Federal Government spent around 80% of its income between January and November 2022 on servicing its debt and this could rise to 95% in 2023. So far the leading presidential candidates have not discussed this challenging topic on the campaign trail. This is probably because the largely financially illiterate voters appear to care more about religion and ethnicity than they do about budget data that they do not fully comprehend.

This is as there is speculation that the CBN’s Governor Godwin Emefiele may be on the run because the Department of State Service (DSS) is seeking his arrest for alleged terrorism financing and other economic offences. Even though the courts have issued rulings prohibiting his arrest there is speculation that the security agencies may ignore the courts order if Emefiele returns to the country. 

President Buhari will finally begin campaigning alongside the ruling All Progressives Congress’ (APC) presidential candidate, Bola Ahmed Tinubu. Starting this week the two men will travel together to ten states as Tinubu steps up his election campaign. Buhari’s presence will likely help attract support from some of the APC governors who, so far, have been lukewarm towards Tinubu’s campaign. 

Meanwhile, the Labour Party presidential candidate, Peter Obi, continues to garner more endorsements following the one from Nigeria’s 1999-2007 president Olusegun Obasanjo. Such endorsements are obviously positive but there are still major doubts that they will be enough to give Obi victory on 25 February unless he is able to mobilise the essential funds that are required to employ polling agents in around 177,000 polling stations on Election Day.

On the security front, the government’s awarding of Niger Delta oil pipeline protection contracts may become a moral dilemma by substituting the controversial amnesty payments with protection contracts. If it is to maintain the recovery in oil production Abuja will probably find itself unable to cancel these contracts without causing unrest in the region, even as they instigate conflict between those militants who have and have not been awarded the contracts.