By Our Reporter
The Nigeria Labour Congress (NLC) has criticised President Bola Tinubu’s request for approval to secure fresh external loans totalling $20.5 billion and €1.45 billion, demanding an explanation for the continued borrowing despite claims of increased government revenue.
NLC President, Comrade Joe Ajaero, questioned the rationale behind the proposed loans, arguing that the Federal Government should account for the additional revenue generated following the removal of the petrol subsidy.
Ajaero spoke on Channels Television’s The Morning Brief on Thursday, where he challenged the government to explain why it continued to seek loans from international financial institutions, including the International Monetary Fund and the World Bank.
He said the government’s claims of increased revenue and higher allocations to state governments raised questions about the need for additional borrowing.
“If you come out to tell us that the subsidy is gone, that you are making more money and then you are giving more money to states, what is the justification for continually borrowing from the International Monetary Fund and the World Bank and other agencies when there is enough money?” he asked.
The labour leader warned that continued external borrowing could worsen Nigeria’s debt burden, insisting that the government must demonstrate the necessity and expected benefits of the proposed loans.
He also questioned the timing of the request, citing the rise in international crude oil prices amid tensions in the Middle East.
According to Ajaero, the increase in oil prices above the $70-per-barrel benchmark reportedly used in preparing the 2026 budget should prompt the government to reassess its borrowing plans.
“If the 2026 budget was prepared with crude oil price benchmarked at $70 per barrel and now sells above $100 per barrel due to the US-Iran crisis, should this country still be collecting loans?” he asked.
Ajaero argued that higher crude oil earnings, alongside increased revenue accruing to oil-producing states, made it necessary for the Federal Government to explain why additional foreign loans remained essential.
He maintained that Nigerians deserved greater transparency regarding the country’s revenue profile, borrowing decisions and the intended use of the funds.
The NLC president, however, clarified that the labour organisation did not have the authority to approve or reject the proposed loans, noting that the responsibility rested with the appropriate government institutions.
He urged Nigerians and relevant agencies to demand accountability from the Federal Government over its borrowing plans and their potential implications for the economy.
Ajaero also called attention to the role of the National Assembly, stressing that lawmakers could reject the President’s request and prevent the proposed loans from receiving approval.
He urged legislators to scrutinise the borrowing proposal carefully, particularly in view of the country’s growing debt obligations and the burden that debt servicing could place on public finances.
The NLC’s position adds to the debate surrounding the Tinubu administration’s borrowing strategy, with the government facing questions over how fresh external loans would be deployed, their expected economic returns and their implications for future generations.
At the centre of the controversy is whether the proposed borrowing is necessary to finance critical infrastructure and development projects or whether improved revenue mobilisation should reduce the government’s reliance on external loans.