Tenure Countdown: States Owe N5.3tn As 12 Governors Near Exit

By: Abudu Olalekan

Time is fast running out for twelve state governors.

By the time most of them bow out in 2027, and two of them in early 2028, they’ll be leaving behind a hefty debt bill — about N5.3tn in combined domestic and external obligations. That’s according to findings by Reportersroom, based on data from the Debt Management Office (DMO).

The governors affected are Umaru Fintiri (Adamawa), Mai Mala Buni (Yobe), Abdullahi Sule (Nasarawa), AbdulRahman AbdulRazaq (Kwara), Dapo Abiodun (Ogun), Inuwa Yahaya (Gombe), Bala Mohammed (Bauchi), Babajide Sanwo-Olu (Lagos), Babagana Zulum (Borno), Seyi Makinde (Oyo), Hope Uzodimma (Imo) and Douye Diri (Bayelsa).

As of the first quarter of 2026, the DMO put their total domestic debt at N2.16tn. Their external obligations, based on the latest state-level figures, stood at about $2.33bn.

Of the lot, only Uzodimma and Diri will stay a little longer — till January 15 and February 14, 2028, respectively. The rest are expected to complete their second terms in 2027.

For some of these states, their debt grew under their governors. For others, it went down — at least in some areas. On the whole though, the burden still piled up.

Lagos Tops The List — By A Wide Margin

Lagos State carries the biggest domestic debt of them all. As of Q1 2026, it stood at N1.205tn — more than half of the entire N2.16tn domestic debt owed by all twelve states put together.

At the opposite end was Nasarawa, with N27.15bn — the lowest among them.

On the external front, Lagos also led with $1.174bn in foreign obligations, as captured in the DMO’s 2025 external debt profile. Yobe had the smallest external debt at $46.67m.

These figures may not even be the final tally. If any of the states borrow more before their tenures end, or if updated DMO figures come in, that N5.3tn could still rise.

A Mixed Bag Of Debt Management

Looking at what each governor inherited compared to what they are set to leave behind, there was no one pattern. Some ramped up both domestic and external debts. A few managed to cut down on one, even if the other went up. To be fair, only a handful actually brought any of their debts down significantly.

In Adamawa, Governor Fintiri is expected to leave domestic debt at N64.7bn — down from the N95.22bn he inherited. His state’s external debt, however, rose from $100.614m to $124m.

In Yobe, Governor Buni saw domestic debt shoot up from N27.47bn to N98.60bn. External obligations also climbed from $26.911m to $46.67m.

For Nasarawa’s Abdullahi Sule, it was the reverse. He is set to leave behind N27.15bn in domestic debt, a steep drop from the N89.95bn he met on assumption of office. The state’s external debt stood at $60.82m.

Imo’s Hope Uzodimma also slashed domestic debt substantially — from N164.436bn to N81.65bn. Still, external debt went up from $64.762m to $117.08m.

Kwara Governor AbdulRazaq managed a slight drop in domestic debt, from N59.58bn to N56.92bn, while external obligations rose from $47.961m to $64.159m.

Ogun’s Dapo Abiodun increased both. Domestic debt rose from N97.050bn to N200.748bn, while external debt jumped from $102.154m to $217m.

Gombe’s Inuwa Yahaya brought domestic debt down slightly from N76.895bn to N65.17bn, but his external debt almost doubled — from $36.960m to $88.7m.

In Bauchi, Bala Mohammed saw domestic debt climb from N93.320bn to N154.45bn, with external debt also rising from $133.705m to $220.6m.

Borno’s Babagana Zulum increased domestic debt from N78.259bn to N88.44bn and external debt from $21.313m to $69.9m.

Bayelsa’s Douye Diri recorded one of the sharpest reductions. He cut domestic debt from N147.930bn to N50.17bn, and also brought external debt down from $59.551m to $55.5m.

Oyo State Governor Seyi Makinde also reduced his state’s debt burden a bit — domestic went from N94.140bn to N69.8bn, while external dropped from $136.531m to $87.5m.

Lagos’ Babajide Sanwo-Olu, on his part, more than doubled domestic debt — from N542.231bn to N1.205tn. He did, however, reduce the state’s external obligations from $1.421bn to $1.174bn.

Debt Is Not Always The Enemy — But It Must Pay Off

So, is all this borrowing bad? Not necessarily, say economists. It depends on what the money was spent on.

Professor Uche Nwogwugwu, a Development Economics lecturer at Nnamdi Azikiwe University, believes states can actually shrink their debt burden if they channel borrowed funds into productive ventures that bring in revenue.

The problem, he said, is the lack of continuity.

“Under the current arrangement, every government that comes in wants to invent its own wheel,” he noted. “Instead of building on what the previous administration started, they often abandon it.”

He pointed to a few states trying to do things differently. “Hope Uzodimma is being inventive in Imo State by trying to channel investments into gas. Alex Otti is also being very inventive by focusing on people-oriented programmes,” Nwogwugwu said.

But he warned that when governments chase flashy, “publicist” projects with no clear returns, they only dig themselves deeper into debt. “Every state has something it can invest in and generate returns. It’s not rocket science,” he added.

“Debt isn’t wrong in itself,” he stressed. “As long as it will be paid back, there’s nothing wrong with states borrowing. Every part of the state should feel both the cost and the benefits of it.”

Sharing a similar view, Professor Jonathan Aremu, an International Economics expert, drew a clear line between good debt and bad debt.

“I always say there is nothing wrong with debt. If you borrow N10m and it generates N20m, that debt is a good one,” Aremu said.

He gave a practical example: building a road that helps farmers get their produce to market would qualify as productive borrowing. “If it is not producing anything, it is dead-weight debt. It puts a lot of burden on the economy,” he cautioned.

For him, any government taking loans must ask the hard question: will this improve lives and generate enough value to sustain the economy?

The Naira Factor Makes External Debt Riskier

One other worry keeps coming up — the steep fall of the naira.

Emerging markets analyst, Ike Ibeabuchi, warned that states relying heavily on foreign loans are exposing themselves to serious exchange rate risks.

The naira, he pointed out, has weakened drastically — from about N465/$inMay2023toaroundN1,326\mathrm{/}$inMay2023toaroundN1,326/ at the time of analysis. That means a dollar-denominated loan today costs almost three times more in naira than it did just a few years back to service.

“With the naira depreciating, external debts are quite a big burden,” Ibeabuchi warned. “If you must borrow, look more towards domestic sources — or even assets to sell — rather than piling up dollar loans.”