The CFG Advisory has issued a strong appeal to the Central Bank of Nigeria (CBN) to take definitive action in response to Nigeria’s economic situation. With a debt profile above $100 billion and significant debt service costs, the country needs proactive strategies to boost growth.
CFG Advisory noted that while Nigeria has achieved economic stability with improved foreign exchange rates and a slight downward trend in inflation, growth has declined from 3.8% in Q4 2024 to 3.1% in Q1 2025. It therefore emphasises the need for measures to stimulate growth, citing the importance of a clear growth-oriented plan.
It recommended the following measures for accelerating the country’s economic growth:
- Interest Rate Cuts: Targeted reduction of interest rates by end of Q3 2025 to boost growth and tackle inflationary pressures
- Inflation Targeting: CBN should commence its inflation targeting programme immediately. A Target of an inflation rate around 12-14% will elevate economic growth to 8-10% based on historical data
- Optimizing Equity in FGN Capital Structure: Sell Oil JV assets to raise $35-$40 billion to reduce debt and enhance the balance sheet.
- Promoting Non-Oil Exports: Sustain and increase investment in non-oil exports, particularly in agriculture, to drive growth.
The firm sees Nigeria’s debt profile which is above $100 billion, with the attendant significant debt service costs as major challenge for the economy. It also said that excessive borrowing by government is crowding out private sector credit and discouraging foreign direct investment.
Pointing the way forward, the firm said there is need for structural reforms, strategic fiscal management, and coordinated approach to Monetary, Fiscal, Trade, Investment and Industrial Policy implementation, to stimulate economic growth at 8-10% sustainable levels. According to it, implementing these measures will restore purchasing power and lift Nigerians out of poverty.
