Nigeria’s debt service-to-revenue may return to 98% in 2 years, economist warns
Economist Paul Alaje criticized the Nigerian government’s simultaneous removal of petroleum subsidies and devaluation of the naira, calling these actions detrimental to the economy.
Speaking at the 3rd Annual Mohammed Fawehinmi Lecture, Alaje argued that such policies are poorly suited for developing economies like Nigeria, drawing parallels to historical economic declines in Russia and Argentina.
Alaje further cautioned against celebrating the recent reduction in debt service to revenue ratio from 98% to 69%, suggesting that without substantial revenue improvements, the ratio could revert to its former level.
He recommended pegging the naira at around N900 to the dollar, reducing government costs, and increasing transparency in project management to stabilize the economy.
Comrade Ayodele Adewale supported the subsidy removal, citing corruption as a major issue in its administration.