Financial Restructuring: Tinubu Clears Nigeria’s IMF Legacy Debt

By Keem Abdul

The wealthy, as the author of ‘Rich Dad, Poor Dad’ would have us believe, do not hate or fear debt. On the contrary, says the American investor and entrepreneur Robert Kiyosaki, they welcome it as an integral part of their business model and investment profile – while also honing and deploying the acumen, discipline and negotiating skills they need to pay it back (or service it) in the short, medium and long term.
The key words, he says, as far as the debt and credit ecosystem is concerned, are ‘fiscal credibility and responsibility.’
As with individuals, so with nations; in fact, some of the wealthiest national economies in the world today are actually among the most-indebted (in most cases to multiple bilateral and multilateral creditors). But some, like the United States of America – which, by some calculations, has the biggest overall debt profile of any economy today – has over the years demonstrated such a consistently high level of fiscal credibility and responsibility that it enjoys an enviable AA+ credit rating from the world’s leading rating and reporting agencies, such as Standard & Poor’s and Fitch Ratings, among others.
Fiscal responsibility was one of the things President Bola Ahmed Tinubu promised would be a feature of his administration’s handling of the Nigerian economy, going forward; in the past two years, with one bold and difficult reform policy after another, his administration has demonstrated its commitment to charting a course of fiscal discipline and a strategic reset in restructuring Nigeria’s finances to put her on a better footing to negotiate the narrow and winding path to a prosperous future.
The latest demonstration of that commitment came with the news on Wednesday, May 8, 2025, that Nigeria had exited the list of countries indebted to the International Monetary Fund (IMF), having just cleared off the last tranche of its $1.61 billion debt to the multilateral institution. This heartwarming development was confirmed by the IMF’s latest update on its website, titled, ‘Total IMF Credit Outstanding – Movement from May 01, 2025 to May 06, 2025,”, in which Nigeria was notably missing from a list comprising over 90 of the Fund’s largest borrowers among developing, low- and middle-income countries.
As at July 28, 2023, according to sources, Nigeria was owing the Fund the sum of $1.61 billion. With the advent of President Tinubu and his team, this sum was reduced to $1.37 billion as at January 5, 2024; then to $933.03 million by July 2024; and then to $472.06 million as at January this year – before it was finally settled last Wednesday.
In a related statement, the IMF also confirmed that Nigeria had, as of April 30, 2025, ‘fully repaid the financial support’ she obtained under the Fund’s Covid 19 Rapid Financing Instrument (RFI) which was disbursed in April 2020 as part of a global emergency response to the economic fallout of the global pandemic and the lockdowns it had occasioned – in Nigeria’s case, the precipitous crash in the price of crude oil, the disruption of supply chains, a second recession and other fiscal pressures. All these repayments amounted to the sum of $3.4 billion.
However, the statement added, additional charges, consist mainly of interest associated with the IMF’s Special Drawing Rights (SDR), will continue to be repaid on an annual basis for the next few years.
Reactions to the news of the federal government’s action in exiting the IMF’s list of indebted countries has been positive, even enthusiastic, among critical stakeholders and financial analysts. “As Nigeria closes the chapter on these legacy debt obligations,” a presidential media aide said, “we are better placed to strengthen our fiscal credibility and show both the world and ourselves that Nigeria is serious about managing our economy with responsibility and vision.” And in the buzz that followed the announcement of the government’s move, stakeholders are now eagerly awaiting the broader ‘Economic Redemption Roadmap’ the Presidency had promised it was going to announce in the coming weeks.
Indeed, even before the latest development, the IMF, in a recent report (written at the conclusion of its 2025 Article IV Consultation Mission to Nigeria a few days ago) had commended the administration’s ongoing economic reforms, describing them as bold measures that have helped stabilize the economy and laid the groundwork for future growth. “The Nigerian authorities,” the report noted, “have taken important steps to … enhance resilience and support growth. These reforms have put Nigeria in a better position to navigate the external environment.” Noting that the global macro-economic outlook is currently marked by significant uncertainty, not least with the ‘elevated global risk sentiment’ and lower oil prices that have impacted so negatively on the Nigerian economy, the report said the Tinubu administration’s macro-economic policies have gone a long way to strengthen buffers and resilience, reduce inflation, and support private sector-led growth. The report added that the federal government’s cessation of deficit financing by the Central Bank of Nigeria (CBN), the removal of costly fuel subsidies, and improvements in the foreign exchange market, were all major policy shifts signaling the Tinubu administration’s unwavering commitment to reform.
What does Nigeria’s exit from IMF debt obligations mean for her? Most analysts say that, because it has come at a time when the country is seeking new development financing, especially for infrastructure, power, and agriculture (per President Tinubu’s vigorous personal diplomacy and his trips to various countries across the globe, during which he met and signed trade and investment deals with world leaders and prospective investors), the move will strengthen Nigeria’s hand in negotiating better terms with international lenders like the World Bank, the African Development Bank, and even private lenders. They say it is not only a significant development for Nigeria’s international credit profile, but it marks a turning point in President Tinubu’s fiscal recovery strategy. Despite the ongoing interest charges to the IMF (which simply highlight the complexities involved in managing long-term loan obligations) the full repayment of the $3.4 billion principal amount is a powerful affirmation of Nigeria’s progress in meeting its external debt responsibilities. In the words of a senior finance ministry official in Abuja, it signals Nigeria’s regained footing and will in no small way engender greater investor confidence in the country’s economy. The successful clearance of the IMF debt also reflects an improved balance of payments situation for Nigeria – thanks in part to the modest recovery recorded in oil exports and renewed foreign capital inflows. On the overall scheme of things, it may be no more than a drop in the proverbial ocean, but it is a clear signal of Nigeria’s commitment to fiscal discipline under President Tinubu’s government. One economist even called it ‘a credibility booster,’ adding that Nigeria (whose past profile had, unfortunately, given the impression that sound fiscal management was not one of its strongest points) was now sending a different and unequivocal message to foreign investors: Nigeria is serious about cleaning its books and attracting sustainable financing.
Far from signaling the end of Nigeria’s engagement with the IMF – an organization which remains a valuable and dependable ally in a volatile and uncertain world – the Tinubu administration’s gesture simply means that, unlike in the past, any future engagement with the Fund and other foreign lenders will be proactive rather than reactive, and will be based on partnership, not dependence – even as the President continues to combine his long-term reforms with sound financial management for the benefit of the economy, and for generations of Nigerians yet unborn.
Time will tell, of course, to what extent, and how soon, the government’s action in this regard will translate to tangible economic relief for a populace still grappling with food inflation, forex instability, and unemployment.
But it is clearly a major stride toward the light at the end of the proverbial tunnel – and as such, worthy of commendation.

• Keem Abdul, publisher and writer, hails from Lagos. He can be reached via +2348038795377 or Akeemabdul2023@gmail.com