The Debt Management Office (DMO) has intensified efforts to strengthen borrowing discipline among subnational governments, particularly in Northern Nigeria, warning that poor debt practices could undermine development and restrict future access to finance.
Director-General of the DMO, Ms Patience Oniha, stated this at the States Action on Business Enabling Reforms (SABER) workshop on Borrowing Guidelines held in Abuja on Tuesday.
Oniha explained that the World Bank-assisted workshop was designed to equip state officials with the skills and knowledge required to borrow responsibly, transparently and sustainably.
According to her, the initiative aims to align borrowing practices at the subnational level with those of the Federal Government, noting that debt remains one of the most sensitive fiscal variables and requires strict oversight and multiple layers of approval.
She said many states face difficulties accessing funds for development projects because officials do not fully understand borrowing procedures, documentation requirements and approval processes.
Oniha stressed that improving knowledge and coordination among debt managers would help streamline borrowing processes and ensure that loans are properly deployed for development purposes.
She warned that failure to manage debt sustainably could expose states and the country to serious consequences, including credit rating downgrades, loss of investor confidence and limited access to future financing.
The DMO boss added that global experience has shown that countries with weak debt governance often face debt restructuring challenges and prolonged economic setbacks, underscoring the need for prudent and transparent debt management at all levels of government.
