Debt service increase from N8 trillion in 2024 to N16 trillion in 2025 is fiscal ‘red flag’ – Expert warns Tinubu 

Speaking during an appearance on Arise Change on Arise Television on Tuesday, Adebayo noted that the escalating cost of debt servicing far outweighs critical national spending, including allocations to defence, security, infrastructure, health, and education combined.

“The fiscal regime [under President Bola Tinubu] has a red flag. And the red flag is the fact that debt service has increased from N8 trillion last year to N16 trillion. So, that is a red flag because the debt service at N16 trillion is more than Defence, Security, Infrastructure, Health, and Education combined which is N14 trillion,” Adebayo said.

“The recurrent expenditure is N14 trillion while the capital expenditure is about N14 trillion. So, when you take a look at the key spending, debt service has now become an issue.”

He emphasized the need for the government to restructure its financial commitments and adopt asset sales as a strategy to ease the debt burden.

Adebayo advised the government to explore other financing options, including key asset sales, to reduce the reliance on borrowing.

“It’s important that government should restructure its balance sheet; sell down assets to repay some of these debts. And, that way, you improve your position. When you pay down debts, you improve your credit rating … internationally. We need to get out of junk bond status to investment grades to make it cheaper.”