Tilewa Adebajo, the Chief Executive Officer of the Creative Financial Group (CFG) Advisory has said that Nigeria’s debt profile is unsustainable, as it cannot be maintained by the government anymore.
In an interview with ARISE NEWS on Wednesday, Adebajo stated that Nigeria can no longer sustain the debt profile, claiming that the debt level is unsustainable.
He mentioned that 96% of Nigeria’s revenue will be going to servicing of debt, saying, “There is no bank in Nigeria that will give you money when you’re using 96% of your revenue to service debt. In our own households we cannot use 96% of our revenues to service debt because we can’t continue to borrow to pay salaries over the last 6 years, it’s not sustainable.
“So, we need to restructure that debt internally and I think debt restructuring is something that we can sit down, we can negotiate and put the structures in place.”
Speaking on the challenges that president-elect, Bola Tinubu, may face due to these issues, he said, “The biggest challenge that Bola Tinubu’s administration faces is the debt profile.”
He made mention of the 2023 budget, where there was a deficit of over 11 trillion naira. “His immediate challenge is to run out the budget for this year, set up his economic management team to be able to see the economy through the end of the year, and then prepare his own budget, his initial budget for 2024 with a renewed economic plan based on that.”
Adebajo said that the best way for Tinubu to make up for the deficit in the budget was to remove fuel subsidy.
For economic growth, Adebajo opined that the president-elect should restructure, refocus and reposition people in the Central Bank of Nigeria (CBN), the Ministry of Finance, and the Ministry of Trade and Investment, as he said that those three organizations, if functioning as they should be, will go a long way into the growth of the economy.
The CEO said that for the president elect’s first six months in office, he should look for ways to stabilise the economy, and afterwards, he could make plans and budgets for the next four years based on the plans that he put in place.
Adebajo then said, referring to Tinubu’s campaign promises on economic growth, that if he was successful in fulfilling this promise, it will also, by default, fulfil the other promises he made for poverty alleviation and job creation.