The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, says Nigeria must cut its reliance on borrowing and build a stronger domestic revenue base to stabilise its finances and fund development sustainably.
Edun spoke on Tuesday at the management retreat of the Nigerian Revenue Service (NRS) in Abuja, where he warned that the global financial climate had grown more hostile to developing economies, making debt-financed growth increasingly expensive and risky. He said revenue mobilisation had become a developmental necessity as countries retreated from multilateral cooperation and prioritised domestic interests.
He noted that this shift had left poorer countries facing an unfavourable balance between inflows and debt service obligations. Citing 2024 data, Edun said developing nations paid about $163bn in debt service, compared with $42bn in overseas development assistance and $97bn in foreign direct investment, showing that external funding flows had effectively turned negative.
According to him, Nigeria must therefore anchor fiscal sustainability on its own capacity to generate revenue, rather than continued borrowing in an era of high global interest rates and tight financial conditions. He added that sustainable revenue was essential to creating savings for investment in infrastructure, education, healthcare and support for the most vulnerable.
Edun linked Nigeria’s rising debt pressures to global shocks such as the COVID-19 pandemic, geopolitical conflicts and trade tensions, which have squeezed fiscal space and raised borrowing costs for developing countries.
His remarks come as the Senate maintains that new borrowing remains unavoidable to address Nigeria’s large budget deficit. At a public hearing on the 2026 Appropriation Bill, the Chairman of the Senate Committee on Appropriations, Olamilekan Adeola, said weak revenue inflows and vast infrastructure needs left the government with few alternatives, arguing that the focus should be on how deficits are financed rather than borrowing itself.
Edun described tax reforms as central to reducing dependence on debt, saying they aim to improve fairness, equity and efficiency while increasing funds for social and capital spending. However, he stressed that reforms would fail without strong execution and better compliance, noting that enforcement alone was insufficient.
He said trust in the tax system was critical, as citizens needed to see fairness in administration and tangible benefits from their contributions. He added that the NRS sat at the heart of the fiscal reform agenda and would play a decisive role in turning policy into results.
Edun warned that Nigeria must build a revenue system resilient to volatility, rather than one overly dependent on oil prices. He said success should be measured by higher and more predictable revenues, reduced fiscal vulnerability and stronger public service delivery.
Earlier, the Executive Chairman of the NRS, Zacch Adedeji, said the creation of the service marked a clear break from the past and placed significant responsibility on its leadership to deliver reform. He stressed that leadership and accountability, rather than structure alone, would determine success, adding that credibility would rest on measurable outcomes that strengthen public trust and support national development.