The Debt Management Office (DMO) has called on sub-national governments in Nigeria to strengthen debt management practices, apply loans prudently, and boost revenue generation to support economic growth.
DMO Director-General Patience Oniha made the call on Tuesday at a World Bank-assisted workshop on “Borrowing Guidelines for Top Policy Makers” in Lagos.
She told state policymakers and finance officials that Nigeria operates as a single economy, where the actions of one tier of government affect the others, making it critical for every level to borrow responsibly.
Oniha said the warning became necessary to prevent another debt crisis, noting that the country had experienced similar challenges in the past.
She stressed that borrowings must be tied to productive projects that generate revenue, create jobs, and improve public services.
She urged states to comply with borrowing laws, adopt Public-Private Partnerships (PPPs) for infrastructure, and strengthen tax compliance to increase revenue without raising tax rates.
According to her, PPPs would reduce the financial burden on the government while attracting private investment, stimulating businesses, and accelerating project delivery.
Lagos State Commissioner for Finance, Abayomi Oluyomi, also addressed the workshop, insisting that responsible debt management forms the backbone of sustainable development and economic resilience.
He explained that fiscal and monetary policies should be designed to improve citizens’ welfare, while debt strategies must remain well researched.
Oluyomi, however, admitted that naira volatility had increased Lagos State’s debt burden and created new challenges.
The workshop, supported by the World Bank, was organised to enlighten sub-national entities on borrowing frameworks and promote strategies that will strengthen Nigeria’s fiscal health and long-term growth.