CPPE Carpet FG’s N15 Trillion for Debt Servicing in 2025

In a statement, the CPPE also critiqued the Federal Government’s projected revenue of N34.82 trillion for the same period, labeling it as overly ambitious. The organization warned against translating this projection into heightened taxes, levies, and fees for investors, emphasizing the need for policies that support business growth rather than stifle it.

Commenting on President Bola Ahmed Tinubu’s recent budget speech, CPPE acknowledged the commendable prioritization of critical sectors such as defense, security, infrastructure, health, and education. These priorities, it said, reflect a commitment to addressing Nigeria’s pressing economic and social challenges.

CPPE noted the President’s optimism for economic recovery, anchored on factors such as reduced fuel importation, the export of refined petroleum products, increased agricultural output due to improved security, and enhanced foreign exchange inflows. While these assumptions were deemed achievable, the organization stressed the importance of unwavering political, policy, and resource commitments to turn these projections into reality.

However, CPPE highlighted concerns about the plan to allocate N15 trillion for debt servicing, which it said could severely constrain Nigeria’s fiscal space. The high cost of government borrowing, both domestically and internationally, was also flagged as a pressing issue requiring immediate attention.

“The government must urgently adopt measures to reduce debt exposure and address the high interest costs associated with sovereign borrowing,” CPPE stated in Tribune online.

On the ambitious revenue projection, the organization cautioned against imposing excessive financial burdens on businesses and called for more systemic and impactful policies to alleviate the social costs of ongoing reforms, particularly for vulnerable groups.

 CPPE reiterated it’s concerns over the Federal Government’s plan to allocate ₦15.81 trillion for debt servicing in the 2025 budget. This amount constitutes approximately 31.69% of the total ₦47.90 trillion budget, marking an 85% increase from the previous year.

CPPE warns that such a substantial allocation to debt servicing poses a significant risk to Nigeria’s fiscal stability. They describe the government’s revenue projection of ₦34.82 trillion as ambitious and caution against imposing additional taxes, levies, and fees on investors to meet these targets.

In the proposed budget, other key allocations include:

Defence and Security: ₦4.91 trillion

Infrastructure: ₦4.06 trillion

Health: ₦2.48 trillion

Education: ₦3.5 trillion

Notably, the combined allocations for Defence, Infrastructure, Health, and Education are less than the amount earmarked for debt servicing.

CPPE emphasizes the urgent need for Nigeria to reduce its debt exposure and address the high costs associated with government borrowing, both domestically and internationally. They advocate for systemic and impactful policies to mitigate the social costs of current economic reforms, aiming to ease the burden on vulnerable segments of society.

The CPPE concluded by urging the government to strike a balance between ambitious fiscal targets and the realities of Nigeria’s economic landscape to ensure sustainable growth and stability.