The Federal Government should urgently implement comprehensive fiscal reforms, including a downward review of the 2026 Budget, to ensure realistic implementation and support Nigeria’s transition from “stabilisation to sustained economic growth,” according to Dr. Tilewa Adebajo, Chief Executive Officer of The CFG Advisory.
He made the statement while presenting the firm’s 2026 economic outlook at the Financial Correspondents Association of Nigeria (FICAN) forum in Lagos on Tuesday, themed, “Economy at Inflection Point: Reform Fatigue Quagmire to Sustainable Growth.”
Dr. Adebajo noted that Nigeria is currently grappling with “economic reform fatigue following two arduous years of adjustment.” While recent reforms have yielded positive results, such as controlled inflation, robust foreign exchange reserves, and naira stability the government continues to face fiscal challenges.
He highlighted assessments by multilateral institutions, including the World Bank and IMF, cautioning against budgetary expansion disconnected from realistic revenue projections.
“Budget execution has been suboptimal, with revenue collections consistently falling short of expectations. This has resulted in record budget deficits and a government debt burden exceeding $100 billion,” he said. “Servicing this debt has become increasingly difficult, with 60% of government revenues, including $15 billion in fuel subsidy savings, going towards debt repayments. Consequently, expenditure that could stimulate economic growth has been neglected, and capital projects with strong multiplier effects were not funded last year.”
Dr. Adebajo pointed out that despite macroeconomic stability, the reforms have not yet delivered the level of growth needed to lift millions out of poverty. He emphasized that the projected N15.52 trillion debt servicing in the 2026 budget exceeds combined allocations to critical sectors such as security, education, and health.
“The current debt profile at over $100 billion is unsustainable. The 2026 budget allocates more to debt service than the combined budgets for security, defence, education, and health, which total N14.97 trillion. All gains from fuel subsidy removal are now going towards debt service. The 2026 Budget urgently needs to be reviewed downward for realistic implementation,” he said.
He also warned that “excessive fiscal spending, a massive deficit, and failure of social intervention programs have left Nigerian households and firms despondent in an economy struggling with stagflation,” adding that it is time to restore social programs and give reforms a human face.
To boost government revenue, Dr. Adebajo proposed selling down at least 49% of the Federal Government’s interest in the 74 Licensed Concession Assets to raise $50 billion and restructure the NNPC balance sheet. He further recommended consolidating NNPC oil forwards contracts into a structured debt instrument to improve transparency, accountability, and management.
On monetary policy, he predicted that the Central Bank of Nigeria (CBN) may cut rates in 2026 to stimulate growth, with official inflation expected to reach single digits by the end of Q2.
He stressed that deliberate disinflation and growth policies should target 8–10% GDP growth to support productivity, employment, exchange rate stability, industry, and investment.
The CFG Advisory outlook projects that Nigeria could achieve about 5% GDP growth in 2026, supported by single-digit inflation, a sub-20% Monetary Policy Rate (MPR), and a more stable naira trading within the N1,400–N1,500 per dollar range, provided reforms are deepened and policy coordination improves.
Dr. Adebajo cautioned that political developments ahead of the 2026 elections could introduce additional uncertainty and emphasized that economic priorities must not be overshadowed by electoral considerations.
“Stabilisation alone is not enough. Nigeria must now move decisively from reform fatigue to reforms that deliver productivity, jobs, investment, and inclusive growth,” he concluded.
