Punitive Interest Rates Crippling Nigeria, Africa’s Growth, Tinubu Tells Kenya Summit

President Bola Tinubu has said punitive interest rates and an unfair global financial system are crippling Nigeria and Africa’s industrial growth.

He said the continent can not compete globally under the current lending structure.

Tinubu spoke on Tuesday at the Africa Forward Summit held at the Kenyatta International Convention Centre in Nairobi, Kenya, where he led Nigeria’s government, diplomatic and business delegation.

The summit, co-hosted by French President Emmanuel Macron and Kenyan President William Ruto, brought together leaders and senior officials from more than 30 countries across Africa.

Speaking on the reform of the international financial architecture, Tinubu said Africa’s economies had remained trapped in a cycle of exporting raw materials while importing finished products because industries on the continent lacked access to affordable capital.

“Last September, from the podium of the United Nations General Assembly, Nigeria warned that the international system must reform or risk irrelevance. We spoke not only of the Security Council but of the financial and trade structures that quietly de-industrialise our nations. The evidence is before us. Despite decades of independence, Africa’s share of global manufacturing value added remains below 2 per cent.

“We export raw minerals, crude oil, and agricultural commodities, and we import processed goods at a premium. This pattern is not an accident. It is the product of a global financial architecture that starves our industries of affordable capital, tolerates massive illicit financial flows, and imposes policy constraints that our competitors themselves never observed when they built their own industrial bases.”

The president said Nigeria had implemented difficult economic reforms, including fuel subsidy removal, exchange rate unification, recapitalisation of the banking system and exiting the Financial Action Task Force grey list.

“Nigeria does not come to this discussion as a supplicant. We come as a nation that has taken painful, homegrown decisions to put our house in order — removing fuel subsidies, unifying our exchange rate, recapitalising our banking system with over US$3.4 billion, and exiting the FATF grey list. These reforms were sovereign choices, not external conditions. They have delivered a declining debt-to-GDP ratio, now projected at 32.3 per cent in 2026, stronger external reserves of $45.5 billion, and a return of investor confidence. But, Excellencies, even a reforming nation like Nigeria is being forced to de-industrialise by a financial system that is stacked against us,” he said.

Tinubu disclosed that Nigeria would spend about $11.6bn on debt servicing in 2026, which he described as a major obstacle to industrial expansion.

“Every single dollar that leaves our treasury to pay punitive interest rates is a dollar that did not go into our steel sector, our textile mills, our agro-processing plants, or our digital industries. It is a dollar that did not train a young Nigerian engineer or provide affordable power for our factories. Our industrial base is being starved of the blood it needs — long-term, affordable finance — while creditors and rating agencies treat African sovereigns as permanent high-risk borrowers, regardless of our fiscal performance.

“So, I ask this gathering: how can an African manufacturer compete with a competitor in Europe, Asia, or North America when the cost of borrowing in our nations is five to ten times higher? How can we build cross-border industrial value chains under the African Continental Free Trade Area when our infrastructure projects face a financing gap deepened by the very institutions meant to bridge it? The answer is plain: we cannot. The international financial architecture, as currently constituted, is an instrument of industrial disarmament for Africa.”

The president maintained that Nigeria was not seeking charity from global institutions but fair access to financing that would support industrialisation and economic competitiveness.

“Nigeria is not asking for charity. We are demanding a financial system that intentionally enables Africa to industrialise — to process its own minerals, refine its own crude oil, manufacture its own pharmaceuticals, and compete fairly in global markets. We will continue to borrow responsibly, but we insist that our creditworthiness be measured by our economic fundamentals and our industrial potential, not by outdated stereotypes,” he said.

Tinubu’s remarks come amid growing criticism over Nigeria’s rising debt profile and the Federal Government’s borrowing plans.

The president recently defended external borrowing while receiving Plateau State leaders at the State House, saying, “If we have to borrow, we borrow. Borrowing is not leprosy, we just have to work hard to be able to pay for it.”

Former Labour Party presidential candidate, Peter Obi, however, criticised the president’s comments. Obi described excessive borrowing for non-productive purposes as dangerous to the economy.

“Mr. President, borrowing is not only a leprosy, but a killer cancer when it is borrowed for consumption and not production as it is in Nigeria today,” Obi said in a Facebook post.

“One of the major ‘leprosy’ afflicting Nigeria today is not just debt, but debt without productivity. Debt that is not tied to measurable economic value. Debt that does not translate into jobs, growth, or improved living standards for the Nigerian people.”

Obi also questioned the legality and economic rationale behind some of the government’s loans, citing provisions of the Fiscal Responsibility Act 2007.

“Most of the borrowings by this government do not satisfy the requirements of law or the requirements of economic common sense,” Obi claimed.

“The humongous borrowing so far does not show how the projects for the loans enhance the productive capacity of the nation and the welfare of Nigerian citizens.”

According to the Debt Management Office, Nigeria’s total public debt rose to N159.27tn at the end of the fourth quarter of 2025 from N97.34tn recorded in late 2023.

The House of Representatives recently approved an additional $516.3m external loan for the Sokoto–Badagry Superhighway following Tinubu’s request in March for a $6bn external borrowing plan.

Meanwhile, on maritime security and the blue economy, Tinubu has pledged to deepen regional cooperation by making Nigeria’s Deep Blue Project maritime intelligence infrastructure available to Gulf of Guinea countries willing to participate.

“Today, I make an explicit commitment: Nigeria will intensify regional coordination by offering our Deep Blue Project’s maritime intelligence infrastructure as a shared data hub for willing Gulf of Guinea states. Interoperable systems, harmonised laws, and seamless joint enforcement must become the daily reality, not an aspiration on paper.

“Let no one misunderstand: maritime sovereignty does not repel investment — it attracts it. Secure sea lanes, predictable regulation, and functional courts are the preconditions that unlock private capital. Governance has de-risked Nigeria’s maritime proposition. We now invite partners to build on these gains as we advance climate-aligned port modernisation and the digital transformation of our maritime sector.”

The president said Africa must move from “sea blindness to ocean sovereignty” to unlock the full benefits of the blue economy.

“The oceans have no duplicate as a common heritage of mankind. For Africa, moving from sea blindness to ocean sovereignty is not a choice — it is a generational duty. Nigeria is ready, and we invite all present to join us in that duty,” he stated.

Tinubu also linked irregular migration to economic hardship and unemployment, calling on international partners to support investments that create opportunities within African countries.

“First, cooperation must address root causes in countries of origin. People who have jobs, security, and hope at home do not typically risk their lives in the back of a smuggler’s truck.

“But we cannot do it alone. International partners must move beyond rhetoric and match words with investments that make staying at home a genuine choice—investments in climate adaptation, energy access, digital skills, and the productive sectors that employ young people. As we intensify the implementation of these domestic measures, I therefore call on our development partners to ring-fence a portion of Official Development Assistance (ODA) for programmes that demonstrably reduce the desperation that fuels irregular migration,” he said.

The president further urged African countries to work together in building a stronger migration governance framework.

“The Global Compact for Safe, Orderly and Regular Migration was a start, but it remains non-binding and underfunded. Nigeria supports the African Union’s Migration Policy Framework and the Khartoum Process, but we need a more coherent link between these regional efforts and global institutions,” he added.

On the sidelines of the summit, Tinubu met with Madagascar President Michael Randrianirina and the President of the Confederation of African Football, Dr Patrice Motsepe, where he expressed Nigeria’s readiness to host the 2026 CAF Awards.

The Nigerian leader was accompanied to the summit by the Minister of Foreign Affairs, Bianca Odumegwu-Ojukwu, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, Minister of Agriculture and Food Security, Sen. Abubakar Kyari, Minister of Marine and Blue Economy, Adegboyega Oyetola, Minister of Environment, Balarabe Abbas Lawal, Minister of Industry, Trade and Investment, Dr Jumoke Oduwole and Minister of Communications, Innovation and Digital Economy, Bosun Tijani.

Chairman of the Dangote Group, Aliko Dangote; Chairman of BUA, Abdulsamad Rabiu; Chairman of the UBA Group, Tony Elumelu; and Chairman of Access Holdings Plc, Aigboje Aig-Imoukhuede, attended the summit.

Others were the Chief Executive Officer of the Nigerian Investment Promotion Council (NIPCO), Aisha Rimi; the Minister of State designate for Foreign Affairs, Ambassador Sola Enikanolaiye; the Director General of the National Council on Climate Change (NCCC), Mrs Omotenioye Majekodunmi; and the Nigerian Ambassador to France, Amb. Ayodele Oke and Director General of the National Intelligence Agency (NIA), Amb. Mohammed Mohammed.