Nearly $857 million committed to four federal-backed projects financed through external loans has been associated with abandoned infrastructure, incomplete programmes and underperforming public services, raising fresh concerns over President Bola Tinubu’s plan to secure another $21.7 billion in external borrowing.

The proposed borrowing for 2026 and 2027 comes amid questions over whether previous loans have delivered the infrastructure, public services and economic benefits needed to justify their costs.

Tinubu is seeking legislative approval for $20.52 billion and €1.045 billion in external loans.

The request, conveyed in a letter read by Senate President Godswill Akpabio on October 27, is intended to finance investments across power, transportation, agriculture, healthcare, education, water supply and national security, alongside employment generation and financial management reforms.

However, BusinessDay observed that the proposed borrowing lacks a detailed public breakdown of the individual projects to be financed, including their locations, costs, contractors and expected returns, making it difficult to assess how the funds would be deployed and the benefits they are expected to deliver.

BusinessDay reported on October 28 that the absence of project-level information complicates an assessment of the economic justification for the proposed loans, particularly which investments could attract private capital rather than require additional government borrowing.

The report also highlighted the substantial increase in Nigeria’s public debt despite improvements in government revenue collection.

According to the Debt Management Office (DMO), the country’s public debt stood at N166.79 trillion at the end of June 2026.

Agora Policy, an independent policy think tank cited by BusinessDay, estimated that public debt increased by N79.41 trillion, or 91 per cent, between June 2023 and June 2026.

If the proposed borrowing is fully contracted and drawn down, the debt burden could approach N200 trillion, depending on exchange rates and other debt movements.

Against this backdrop, BusinessDay found that nearly $857 million committed to four loan-funded projects are associated with abandoned infrastructure, non-functional electricity installations, an underperforming urban water scheme and an incomplete rural telephony programme.

The projects include a $399.5 million loan for the National Public Security Communications System, a $7.5 million rural electrification project, $250 million in originally approved financing for the Third National Urban Water Sector Reform Project and a $200 million loan associated with the first phase of the National Rural Telephony Programme.

Although the projects differ in their outcomes and the extent of their shortcomings, they illustrate how weaknesses in implementation, maintenance and project completion can prevent borrowed funds from delivering their intended public benefits.

$399.5m security network becomes dormant

The National Public Security Communications System (NPSCS), designed to strengthen security communications and support policing, has become dormant, BusinessDay gathered.

A recent visit by our correspondent to some of its facilities in Lagos found that they had been abandoned, vandalised and, in some cases, left to deteriorate.

Awarded to China’s ZTE Corporation in August 2010 at a contract sum of $470 million, the project was financed by a $399.5 million China Exim Bank loan, with the Federal Government expected to provide the remaining $70.5 million as counterpart funding.

The system was designed to provide surveillance cameras, command centres and communications infrastructure for security agencies.

About 2,000 CCTV cameras were among the facilities intended to improve monitoring and coordination in major cities, including Lagos and Abuja.

In July 2023, the Federal Government inaugurated a project management team to oversee the rehabilitation and management of the network under a concession arrangement.

However, the initiative did not establish how much of the infrastructure had been restored, how many facilities were operational or whether the system was delivering its intended security benefits.

A Debt Management Office record showed that $276.58 million remained outstanding on the China Exim Bank loan as of September 30, 2021.

$7.5m rural power project leaves communities in darkness

A $7.5 million rural electrification project in Enugu, Cross River and Ogun states has failed to deliver reliable electricity to beneficiary communities, despite the installation of infrastructure in many of the 72 locations, BusinessDay gathered.

Our correspondent found that some communities in Ogun State remained without electricity years after the project was reportedly 95 per cent complete, with transformers, poles and wires abandoned or left unused. Some residents have resorted to alternative means of securing electricity.

An investigation by the International Centre for Investigative Reporting (ICIR) also found that communities in Ogoja Local Government Area of Cross River State had remained without the expected electricity supply for about a decade after the project began.

Some transformers had rusted or leaked oil, while residents repurposed wires connected to their homes.

In Amachalla, Enugu State, a community representative told ICIR that the project had been completed but never put to use, forcing residents to seek electricity through other means.

Contract documents obtained by BusinessDay valued the project at $7.5 million. Financed by the International Development Association under the National Energy Development Project, it was intended to expand rural electricity access and strengthen existing distribution networks.

$250m water project falls short of targets

The $250 million Third National Urban Water Sector Reform Project illustrates the gap between approved development financing and actual results.

Approved by the World Bank in April 2014 to improve water access in Bauchi, Ekiti and Rivers states and strengthen water utilities, the project closed in March 2021 with an overall outcome rating of moderately unsatisfactory and only modest achievement of its objectives.

The $250 million figure represents the originally approved financing and should not be mistaken for the amount actually spent or lost. Actual disbursements were substantially lower.

However, the World Bank’s assessment, implementation delays and concerns raised by Corporate Accountability and Public Participation Africa (CAPPA), as reported by BusinessDay in 2025, point to shortcomings in translating the programme’s financing into sustained improvements in water supply.

$200m rural telephony programme remains incomplete

The first phase of the National Rural Telephony Programme was financed with a $200 million China Exim Bank loan but remained incomplete despite repayment of the loan’s principal and interest, according to a House of Representatives resolution adopted on March 16, 2017.

The resolution stated that the Federal Government had paid N300 million in counterpart funding for the second phase, which stalled after China failed to release its share.

Lawmakers also warned that the technology could become outdated as GSM services expanded.

A subsequent report on lawmakers’ inspection of the facilities described equipment lying idle.

BusinessDay’s analysis shows that the incomplete rollout, despite repayment of the loan, exposes the gap between financing and delivery, with implementation delays and ageing technology threatening the investment’s long-term value.

Borrowing must translate into measurable results

Economic and governance experts said the four projects exposed weaknesses in the planning, implementation and monitoring of loan-funded investments.

They said the government must demonstrate how it intends to prevent implementation delays, abandoned infrastructure and underperforming projects under the proposed $21.7 billion borrowing plan.

Faruq Oyedele, an economist, said lawmakers should scrutinise not only the loan amounts and financing terms but also the feasibility of the projects, the implementing agencies and the mechanisms for monitoring delivery.

He said every proposed investment should have a clear objective, implementation timetable, cost assessment and measurable targets against which performance could be evaluated.

Oyedele said the four loan-financed projects showed why the government must look beyond the amounts approved or disbursed when assessing the performance of publicly funded investments.

He said assessments should establish whether infrastructure was operational, beneficiaries were receiving the promised services, and projects had achieved their intended objectives.

He also called for stronger monitoring throughout the project cycle, from procurement and construction to commissioning and maintenance.

On the proposed $21.7 billion borrowing plan, Oyedele urged the National Assembly to scrutinise individual projects rather than rely solely on sectoral allocations and overall loan amounts.

He called on the government to publish project-level information and provide regular updates on disbursements, expenditure, implementation progress and completed deliverables.

Kabir Adejumo, senior researcher and PMER manager at Good Governance Africa (GGA), said the problems associated with Nigeria’s loan-funded projects reflected deeper weaknesses in public investment planning and accountability, rather than simply the failure of individual administrations to complete projects.

He said many projects entered the public investment pipeline without rigorous and transparent assessments of their technical, economic and financial viability, leaving them vulnerable to delays, changing government priorities and funding uncertainties.

“Governments change, ministers change, and priorities change, but projects remain. Instead of having a national project pipeline protected by objective appraisal and long-term financing commitments, projects in Nigeria are often associated with particular administrations. A new government sometimes restarts a project rather than continuing the previous administration’s programme,” he said.

Adejumo said the economic cost of failed infrastructure extended beyond the money spent on construction.

He said the country also lost the productive capacity, jobs, businesses and wider economic activity that the projects were intended to generate.

Previous loans must be accounted for
Joseph Amenaghawon, the head of CivicHive, said FG should account for previous borrowing before seeking approval for additional loans, including disclosing how much was drawn down, the projects funded and their current implementation status.

He noted that financing gaps had delayed several infrastructure projects, including the Abuja-Kano and Port Harcourt-Maiduguri rail lines.

Amenaghawon stressed that the government should secure full project financing and provide for counterpart funding before commencing new investments.

He called for every proposed project to have a clear implementation timeline, cost assessment and measurable targets, while insisting that loan proceeds should be traceable through the Open Treasury Portal, from disbursement to payments to contractors.

The governance expert also urged the government to subject completed projects to independent engineering audits before releasing final payments and include provisions to cancel or redirect undisbursed funds when contractors repeatedly miss agreed milestones.

On the proposed borrowing, he said the government must publish details of previous loan disbursements and project outcomes, alongside the expected returns and repayment plans for new investments.

He further urged the National Assembly to approve loans on a project-by-project basis, require quarterly public reports and conduct site inspections.