The Slavery Paradox: Foreign Debt and Nigeria's Economic Sovereignty

Abstract

Nigeria’s external debt exceeded $45 billion by 2025, with debt‑servicing costs consuming over 144 percent of retained revenue, a condition this study terms the “Slavery Paradox”—where political independence coexists with fiscal subjugation to external creditors. The paper examines how foreign loan dependence, enforced through international conditionalities, systematically erodes Nigeria’s economic sovereignty. Employing a qualitative, critical‑interpretive design, the study synthesises historical fiscal data, policy documents, and conceptual literature from 1960 to 2025 through the dual lenses of neocolonialism and structural adjustment theories. Key findings reveal a “revolving door” of capital flight and a “dual debt trap” in which ballooning domestic debt (₦76.59 trillion) compounds external pressures, paralysing social investment. The paper concludes that reclaiming sovereignty requires strategic decoupling—pro‑industrial policies, progressive taxation, and elite accountability—drawing contextual lessons from Botswana, Rwanda, and Vietnam. The study contributes a framework linking macro‑level power dynamics with micro‑level fiscal mechanisms that perpetuate post‑colonial dependency.