Nigeria’s Minister of Finance and Coordinating Minister for the Economy, Wale Edun, has disclosed plans to address the N13 trillion shortfall in the proposed 2025 budget through borrowing. This was revealed after a Federal Executive Council (FEC) meeting at the Presidential Villa in Abuja.
The 2025 budget, valued at N48 trillion, projects a revenue of N34.82 trillion and an expenditure of N47.96 trillion, marking a 36.8% increase in spending compared to 2024. The resulting deficit, equivalent to 3.89% of the country’s GDP, underscores the government’s reliance on debt to finance critical projects
Speaking on the rationale behind the budget, Edun highlighted its alignment with the economic reforms implemented under President Bola Tinubu’s administration over the past 18 months. According to him, the focus remains on fiscal sustainability and fostering an investment-friendly environment to drive private-sector-led growth.
“Governments globally are grappling with fiscal challenges. For Nigeria, the priority is balancing revenue, expenditure, and borrowing to create an economy that fosters growth, attracts investment, and lifts citizens out of poverty,” Edun stated.
He further emphasized the administration’s commitment to reforms such as the deregulation of petroleum product pricing, adjustments in foreign exchange rates, and ongoing improvements in electricity tariffs. These measures, he argued, have already attracted significant foreign investments.
Edun cited recent investments by global energy giants as evidence of Nigeria’s improving economic climate. He noted Shell’s $5 billion commitment and a similar multi-billion-dollar pledge by Total, signaling growing confidence in Nigeria’s economy.
“Encouraging private sector investments remains a cornerstone of this budget. Government spending is directed at critical areas while creating room for businesses to thrive. This approach has already led to significant strides, including the establishment of domestic petroleum refining for the first time in decades,” Edun added.
The finance minister also drew parallels between Nigeria’s fiscal struggles and those of advanced economies, stressing the importance of macroeconomic stability. He argued that reforms initiated by the Tinubu administration have positioned the country on a path to sustainable growth.
“This budget is not just about government expenditure but about fostering a vibrant private sector that drives productivity, job creation, and poverty reduction,” he concluded.
With the projected borrowing, the government aims to fund critical sectors while continuing to implement reforms aimed at boosting revenue and reducing dependency on debt in the long term.
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