Introduction

I write in the public interest, for posterity, and to set the record straight amid growing political rhetoric and economic misconceptions. Too often, the masses are swayed by appealing but simplistic narratives from political leaders. One such narrative is the popular claim by some Governors that “we have not borrowed.” While this may sound fiscally responsible on the surface, it raises an important question: is this truly sound economic policy, or a misunderstanding of development finance?
Recently, during a media chat with the Governor of Anambra State, Dr. Reuben Abati of Arise TV inquired about the level of borrowing undertaken to execute major infrastructural projects, including the construction of a new Government House. The Governor proudly stated that his administration had not borrowed a kobo. This assertion provides a useful backdrop to examine the economic implications of borrowing in public finance.

What Is the Primary Objective of Government?

Chapter II, Section 14(2)(b) of the 1999 Constitution of the Federal Republic of Nigeria clearly states that “the security and welfare of the people shall be the primary purpose of government.” This is not optional—it is a constitutional obligation.

To fulfill this mandate, government must ensure that:
1. No citizen goes to bed hungry.
2. The elderly and vulnerable are adequately cared for.
3. Employment opportunities exist for all willing and able individuals.
4. Functional financial systems (banking and insurance) serve public/ private interest efficiently.
5. Reliable and affordable electricity is provided.
6. Access to healthcare is not determined by one’s financial capacity.

These responsibilities require substantial financial resources, which are often beyond what internally generated revenue and monthly allocation from Abuja can provide.

Borrowing as an Instrument of Development

In economics, public borrowing—when properly managed—is not inherently harmful. On the contrary, it is a legitimate fiscal tool for bridging resource gaps and financing long-term capital projects. The key issue is not whether government borrows, but how and why it borrows.A forward-thinking government should:
Invest in productive sectors such as agriculture, housing, infrastructure, and healthcare.Government can stimulate aggregate demand by ensuring income flows to households,
promote inclusive growth and reduce poverty.For instance, if a Government undertakes data-driven planning—identifying population segments such as youths, unemployed persons, retirees, and the working class—it can effectively allocate resources to maximize productivity. When citizens are gainfully employed, crime rates decline, economic activity expands, and overall welfare improves.

The Illusion of “No Borrowing”.

The “no borrowing” mantra, while politically attractive, can be misleading if it results in underinvestment in critical sectors. In a developing economy like Nigeria, where infrastructure deficits are significant, outright avoidance of borrowing may signal missed opportunities rather than fiscal discipline.
It is important to distinguish between:
Productive borrowing (for infrastructure, job creation, and economic expansion), and
Unproductive borrowing (for recurrent expenditure such as salaries or consumption).

The former drives growth and can repay itself over time through increased revenue, while the latter can lead to fiscal distress.

The Reality of Governance and Citizen Expectations.

A troubling reality is that many citizens have normalized government failure. Individuals provide their own water, security, electricity, and even basic infrastructure. This reflects a breakdown in the social contract.

Critical questions must be asked:

i. Does the government actively address unemployment?

b. Is there a clear strategy for improving power supply?

c. Are citizens genuinely benefiting from public resources?

In many cases, the answer is no.

Conclusion

Government must, where necessary, utilize borrowing as a strategic tool to organize the factors of production, stimulate economic activity, and fulfill its constitutional mandate. Avoiding borrowing entirely, especially in a resource-constrained environment, may reflect not prudence but a limited understanding of development economics.

That said, borrowing must be responsible, transparent, and tied strictly to productive investments—not to finance consumption or recurrent expenditure.
Ultimately, good governance is not measured by the absence of debt, but by the presence of development, improved welfare, and a better quality of life for the people.

Anaenugwu Ndubuisi
Ambassador General
Good Governance Ministry (GGM)
Email: ggovernanceministry@gmail.com

In Abraham Maslow’s hierarchy of needs, shelter ranks just after food as a fundamental requirement for human survival.Governments across the world recognize this reality and deliberately design policies to ensure that citizens can afford a roof over their heads. In many economies, minimum wage structures are calibrated to reflect the cost of living—particularly housing, whether through rent or mortgage.

In recent years, however, the cost of house rent across South-East Nigeria has risen at an alarming and unsustainable rate, placing immense pressure on residents—especially low- and middle-income earners.

Major urban centres such as Enugu, Owerri, Awka, Aba, and Abakaliki are increasingly experiencing a housing crisis that is steadily eroding living standards and deepening economic hardship.

What was once considered affordable housing has now become a luxury. A single-room self-contained apartment that previously cost about ₦100,000 per annum now goes for ₦400,000 or more. Self-contained apartments that were once ₦150,000 now command as high as ₦800,000.

In Awka, a three-bedroom flat in areas such as Commissioners’ Quarters can cost up to ₦2,500,000 annually, with additional service charges of about ₦200,000( Note that the national minimum wage is N840,000 per annum) . In Onitsha, a two-bedroom flat averages ₦500,000 per annum, even in relatively less expensive areas like Mgbuke, Awada, and Nkpor—still burdensome when compared to prevailing income levels.

This trend is not only unsustainable but socially destabilizing.
Several factors are responsible for this sharp escalation. Rapid urbanization remains a key driver, as increasing numbers of people migrate to cities in search of better economic opportunities.

Unfortunately, this population growth has not been matched with corresponding housing development, resulting in a widening gap between demand and supply—and inevitably, higher rents. Compounding this is the lack of reliable housing data; state governments have not been sufficiently intentional about tracking residential stock and projected demand.

Equally significant is the rising cost of building materials. Cement, iron rods, roofing sheets, sand, laterite, labour, and other construction inputs have witnessed steep increases due to inflation, exchange rate volatility, and high transportation costs. Landlords, seeking to recoup their investments, transfer these costs directly to tenants through higher rents.

Moreover, the weak enforcement of effective regulatory frameworks has worsened the situation. In many parts of the South-East, landlords fix rents arbitrarily, with little or no oversight. Weak tenancy laws (and in some states, their outright absence) have enabled exploitative practices such as excessive advance payments—often one to two years—unjustified rent hikes, and hidden charges.

The consequences are far-reaching. Many families are forced to relocate to substandard housing on the outskirts of cities, increasing transportation costs and reducing overall quality of life. Young people, including students and early-career professionals, are increasingly unable to secure decent accommodation. Overcrowding and the proliferation of informal settlements are rising, posing serious health and security risks. In extreme cases, the psychological toll has led to tragic outcomes.

This growing crisis demands urgent and deliberate government intervention. Housing must be treated as a central pillar of social welfare and economic stability. Recent public engagements by some state leaders suggest a worrying underestimation of the scale of the problem, as well as a lack of clear, actionable housing policies. While reliance on market forces is a legitimate economic philosophy, housing—given its social importance—cannot be left entirely to market dynamics.

Well-designed housing policies, including measured rent regulation, can help stabilize the market and curb arbitrary pricing. Contrary to common fears, effective regulation can also attract investment by creating a more predictable and structured environment for developers.

Governments should actively partner with private developers through Public-Private Partnerships (PPPs) to deliver affordable housing at large scale. Strategic incentives—such as tax reliefs, subsidized land, and support for local building materials—can stimulate private sector participation and reduce construction costs.

Access to housing finance must also be expanded. Many Nigerians are unable to build or purchase homes due to limited access to affordable mortgage systems. Strengthening housing finance institutions and introducing flexible, single-digit interest mortgage schemes will significantly ease pressure on the rental market.

Equally important is the strict enforcement of tenancy laws. Regulatory authorities must ensure fairness and transparency in landlord-tenant relationships, including reasonable rent increments and standardized payment structures.

In conclusion, South-East governors must, as a matter of urgency, collaborate with the private sector to develop large-scale, high-density housing projects—including multi-storey residential buildings—to accommodate low-income earners while creating employment opportunities for the youth. There is also a need for strategic engagement with the Federal Government to review wage policies, potentially incorporating productivity-based and hourly remuneration structures to better align incomes with the rising cost of living.

The time to act is now. Housing is not a luxury—it is a necessity. Any society that neglects this fundamental need risks deepening inequality, social instability, and economic decline.

Ndubuisi Anaenugwu
Ambassador General
Good Governance Ministry (GGM)
Email: ggovernanceministry@gmail.com