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Nigeria is edging toward economic collapse as the Central Bank of Nigeria (CBN) is allegedly unable to honour government promissory notes, legal luminary Afe Babalola has warned.
Speaking at a leadership conference in Ado-Ekiti, Babalola said commercial banks have raised alarm that the CBN is refusing to redeem promissory notes issued by the federal government, which he described as a dangerous signal for any economy.
He said this situation reflects a country operating as a debtor state and rapidly losing credibility in the eyes of foreign investors.
“The record shows that Nigeria, as of today, is a big debtor country,” he said.
Babalola noted that the nation’s total debt has risen to ₦152.4 trillion ($99.7 billion), a financial burden he said is discouraging foreign businesses from investing in Nigeria.
“Consequently, most business companies from other countries do not want to invest in this debtor country,” he said.
He added that banks are complaining that the CBN cannot meet its financial obligations because the federal government is in debt to the apex bank.
According to him, once a central bank is unable to pay what it owes, confidence in the financial system begins to crumble and a wider economic crisis becomes imminent.
Babalola reminded those in power that the Nigerian Constitution places the security and welfare of the people as the primary purpose of government.
“The security and welfare of the people shall be the primary purpose of government,” he quoted from Section 14.
He called for immediate reforms, disciplined financial management and an end to reckless borrowing by those managing the economy.
He warned that no country can expect investor confidence when it cannot honour its debts or provide stability for its citizens.
Development expert Otive Igbuzor, who also spoke at the event, said the country needs transformational leaders who can confront corruption, economic decay and policy failures.
He said leadership should reward competence and innovation rather than political loyalty and patronage.
Vice Chancellor of Afe Babalola University, Smaranda Olarinde, said the conference was timely given the deepening hardship, insecurity and uncertainty across Nigeria.
