Business
Nigeria May Slip Into Recession as Budget Deficit Hits N30.58trn In Seven Years
The budget deficit has risen to at least N30.58tn in the last seven years.
This is according to data from budget implementation reports for the third and fourth quarters of 2015; the four quarters of 2016, 2017, 2018, 2019, 2020; the first three quarters of 2021; and the first four months of 2022.
According to Investopedia, a budget deficit occurs when expenses exceed revenue.
An analysis of the reports on the Budget Office of Nigeria’s website revealed that Buhari’s administration had spent at least N54.98tn on budget implementation since its inception but has only financed this spending with N24.39tn, leaving a deficit of N30.58tn.
A breakdown of some of the expenses revealed that the present administration had spent at least N23.66tn on personnel costs, pensions, overhead costs, presidential amnesty programme, other service-wide votes, and special interventions.
A minimum of N14.13tn has been spent servicing domestic and foreign debts, and at least N10.47tn has been spent on capital expenditure.
According to the reports, this deficit financing has been largely financed by government borrowing. The budget implementation report for Q4, 2015 said, “The FGN has arranged to raise short-term credit from the CBN through the mechanism of Ways and Means subject to a ceiling of 12.5 percent of FGN’s revenue.
“This amount will be retired and therefore not considered as new borrowing outside the borrowing approved to finance the budget deficit. However, due to current fiscal challenges, the CBN had agreed to increase the Ways and Means advances threshold hence the FGN’s ability to raise N615.96bn from this source.”
Since allowance for raising the ceiling was made, total borrowing from the CBN has hit N19.01tn in April 2022 from N648.26bn as of June 2015.
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Also, the nation’s total debt profile hit N41.06tn as of March 2022 from N12.12tn, according to the Debt Management Office.
A document titled ‘Public Consultation on the Draft 2023 – 2025 MTFF/FSP’ presented by the Minister of Finance, Budget & National Planning, Mrs. Zainab Ahmed, said, “Revenue generation remains the major fiscal constraint of the federation. The systemic resource mobilization problem has been compounded by recent economic recessions.”
Recently, the Monetary Policy Committee of the Central Bank of Nigeria raised concerns over the nation’s debt sustainability. It said the Federal Government’s debt profile was worrying and noted that there was a need for it to urgently diversify its revenue base.
Commenting on the story, economists stated that a high deficit was not good for the economy and might cause inflation, recession, and slow down growth.
Speaking to a reporter, an economic expert, and seasoned academic at the University of Uyo, Professor Akpan Ekpo, said, “This shows that expenditure has eclipsed the revenue, because they have to borrow, which is why there is a deficit.
“They can’t raise enough domestic resources to finance spending. That gap is a deficit. Talking about GDP, by the rules, it should not be more than a certain percentage of GDP, but it has exceeded that. And when you borrow, you have expectations of borrowing because if you are not transparent, we don’t know what you are borrowing for.
“If you are borrowing to finance recurrent and overhead, it is not good for the economy. If you borrow to finance capital projects, in the long run, even if you have a deficit, it will have a positive multiplier effect. The deficit, if it is used to finance recurrent, is problematic to the economy.
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“One way of solving that is to raise more of domestic revenue or cut down on expenditure that is not needed, especially, the cost of governance. There is a need to check the expenditure profile and cut down on it. Or we could do expenditure switching, where unimportant items are switched with important items.
“We are spending more than we can raise resources and we are not spending it on hard infrastructure.”
Associate professor of Economics at the Pan-Atlantic University, Lagos, Olalekan Aworinde, added that the deficit was being financed by either government borrowing, sales of government properties, or printing money.
According to him, any of these options had implications for the economy. He stated, “Loans can be good and can be bad. A loan is good if it is used for productive expenditure, but if it is used for recurrent expenditure or consumption expenditure, this is not bringing back any returns.
“If the component of this deficit is majorly recurrent expenditures, it shows that we are unlikely to have any growth. There isn’t going to be any revenue coming out from there. The implication of this is that we are likely going to have stunted growth. Stunted growth in the sense that we are not likely going to have an increase in the total values of goods and services that are produced in the country.
“If care is not taken, we are likely going to slide into recession.”
He added that financing the deficit through sales of government properties would mean the government was reducing its asset base, which did not speak well for the economy.
NPO
Railway
British Museum, Oxford experts visit NRC Legacy Museum, seek heritage partnership
British Museum, Oxford experts visit NRC Legacy Museum, seek heritage partnership
A delegation of experts from the British Museum and University of Oxford has visited the Nigerian Railway Corporation (NRC) Legacy Museum, opening discussions on potential international collaboration to preserve and revitalise Nigeria’s railway heritage.
The familiarisation tour was led by Paul Bagu, alongside Mrs. Julia Hudson, as the team assessed the museum’s historical assets and conservation needs.
During the visit, the delegation toured key sections of the facility, including the iconic Old Running Shed, home to ageing locomotives and vintage coaches that reflect Nigeria’s rail transport evolution.
The experts expressed strong interest in restoration efforts, stressing the urgency of preserving the artefacts through technical support and global partnerships.
Describing the museum as a critical archive of Nigeria’s industrial past, Bagu noted that it holds “immense cultural and historical value,” adding that collaboration in conservation, restoration, and knowledge exchange would be vital to safeguarding the assets for future generations.
A major highlight of the tour was the historic coach used by Queen Elizabeth II during her visit to Nigeria.
The delegation pointed to the shared railway history between Britain and Nigeria as a strong foundation for deeper institutional partnerships.
“The historical links between Britain and Nigeria’s railway development present a unique opportunity to build enduring collaborations that celebrate this shared heritage,” Bagu said.
Drawing parallels from West Africa, he referenced a successful railway heritage initiative in Freetown, where sustained efforts by local enthusiasts have helped revive a once-dormant museum.
He urged similar grassroots commitment in Nigeria to complement institutional support.
President of the Legacy Museum Railway Compound, Mr. Taye Olaniyi, welcomed the delegation, describing the visit as a validation of the museum’s growing relevance.
He also acknowledged the contributions of retired NRC director, Mr. Nate Adediron, to the development of the facility.
“We are honoured to host our distinguished guests. Their visit underscores the importance of global partnerships in advancing our vision of making the NRC Legacy Museum a leading railway heritage centre in Africa,” Olaniyi said.
Providing technical depth to the engagement, Engr. Dr. Quadri A.T., Assistant Director (Mechanical) at NRC, briefed the visitors on the operation and maintenance of both legacy and modern locomotives.
His presentation highlighted ongoing efforts to preserve historical assets while aligning with contemporary rail development standards.
The delegation also explored thematic exhibits covering railway administration, Nigeria’s political evolution, and transitional milestones in national development—elements that reinforce the museum’s educational value.
Commending the initiative, Bagu encouraged greater public engagement, particularly among young Nigerians, to ensure long-term sustainability of heritage preservation efforts.
The visit concluded with the presentation of certificates to key contributors and institutions, followed by a group photograph session.
The engagement marks a significant step toward international collaboration and strengthens efforts to position the NRC Legacy Museum as a premier railway heritage destination in Africa.
Business
Tax Evasion: Lagos Government Sues Bi-Courtney, DAAR, 33 Others
Tax Evasion: Lagos Government Sues Bi-Courtney, DAAR, 33 Others
The Lagos State Government has initiated legal proceedings against 45 individuals and corporate entities over alleged unpaid taxes amounting to several billions of naira.
The cases have been filed before the state’s revenue court as part of intensified efforts to enforce compliance with tax regulations and improve internally generated revenue.
Prominent among those listed in the suits are Bi-Courtney Aviation Services, operators of the Murtala Muhammed Airport Terminal Two; DAAR Communications Plc, owners of Africa Independent Television; and Leaders & Company Limited, publishers of ThisDay newspaper.
Official figures indicate that Bi-Courtney Aviation Services allegedly owes N38.7 million, while DAAR Communications has an outstanding liability of N22.4 million. Leaders & Company Limited is also accused of defaulting on taxes to the tune of N67.1 million.
Other organisations identified as major defaulters include GMT Energy Resources Limited, with liabilities exceeding N145.8 million, and Sheriff Deputies Limited, which allegedly owes over N132.1 million.
The list further features companies such as Heyden Petroleum Limited, AA Rescue, and Primero Transport Services Limited, alongside several others with varying tax obligations.
Additional firms named in the court filings include IENG Nigeria Limited, James Fisher Nigeria Limited, V Care Diagnostics Limited, Venture Garden Nigeria Limited, Saro Africa International Limited, and Barry Callebaut Nigeria Limited.
Media and technology firms, including Native Media Limited, First Consulting Media & Centre Limited, and Eyowo Integrated Payments, were also listed as defendants.
The State Attorney-General and Commissioner for Justice, Lawal Pedro, disclosed that the decision to commence legal action followed repeated notices issued to the affected parties, which were ignored.
He noted that while individual tax liabilities range between N13.5 million and N35 million, corporate organisations account for the bulk of the outstanding sums.
Pedro explained that the state government resorted to litigation after the taxpayers failed to fulfil their statutory obligations or take advantage of opportunities provided to regularise their tax status.
He added that the enforcement initiative forms part of broader efforts to strengthen tax compliance and boost revenue required for infrastructure development and essential public services.
The Attorney-General further clarified that taxpayers who complied with pre-action notices and settled their outstanding liabilities would not be prosecuted.
He urged residents and business operators to adhere strictly to tax laws by filing annual returns and paying assessed taxes promptly, warning that continued default could attract penalties, interest, and further legal consequences.
Tax Evasion: Lagos Government Sues Bi-Courtney, DAAR, 33 Others
Business
US-Iran Conflict: MAN Outlines Urgent Steps to Shield Nigerian Manufacturers
US-Iran Conflict: MAN Outlines Urgent Steps to Shield Nigerian Manufacturers
The Manufacturers Association of Nigeria (MAN) has raised alarm over the escalating US-Iran conflict impact on Nigerian manufacturers, warning that the geopolitical tensions in the Middle East pose immediate, severe, and multi-layered risks to Nigeria’s industrial sector.
Director-General of MAN, Segun Ajayi-Kadir, said the sector is already feeling the effects of a global energy shock, noting that the industry’s projected 3.1% growth target for 2026 is now under serious threat.
He explained that manufacturers’ dependence on diesel and gas for production has left them highly vulnerable to rising global crude oil prices, which have pushed up domestic energy costs and significantly eroded profit margins.
“Energy cost escalation is biting hard. Many manufacturers are seeing their margins wiped out almost overnight,” Ajayi-Kadir said, highlighting the growing strain on operators.
The energy crisis in Nigeria’s manufacturing sector has been compounded by imported inflation, rising freight charges, and prolonged shipping delays. According to MAN, higher logistics and transportation costs are making the importation of critical raw materials increasingly expensive, thereby disrupting production cycles.
Ajayi-Kadir warned that the situation has created a double burden of rising production costs and weakening consumer demand, leaving many manufacturers with unsold inventories and shrinking revenues.
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“The implication is clear – production costs are rising sharply, while consumer purchasing power is weakening. Manufacturers are now battling both high costs and unsold inventories,” he said.
Beyond energy and logistics challenges, MAN noted that exchange rate volatility and limited access to foreign exchange have further complicated operations, making it difficult for manufacturers to source essential inputs.
To mitigate the crisis, MAN outlined several key measures to stabilise Nigeria’s manufacturing sector, urging the Federal Government to act swiftly.
The association called for the fast-tracking of the Presidential Compressed Natural Gas (CNG) initiative, which it believes will help industrial clusters reduce reliance on diesel and lower energy costs.
It also recommended the creation of a dedicated foreign exchange window by the Central Bank of Nigeria to ensure manufacturers have timely access to forex for importing raw materials and machinery.
In addition, MAN advocated for the domestication of petroleum supply chains, urging local refineries to prioritise supply to domestic manufacturers at competitive rates to cushion the impact of global oil price volatility.
To ease logistics pressures, the group proposed a six-month suspension of multiple taxation, haulage levies, and highway tolls, noting that transport-related costs have surged significantly.
“The current crisis is a stark reminder of Nigeria’s vulnerability to external shocks due to our dependence on imported inputs,” Ajayi-Kadir said, stressing the need for structural reforms.
He added that the situation presents an opportunity for Nigeria to pursue manufacturing self-sufficiency, reduce import dependence, and build a more resilient industrial base.
Industry analysts also warn that sectors such as chemicals, pharmaceuticals, food processing, and steel are particularly exposed due to their reliance on imported inputs and sensitivity to global price fluctuations.
MAN cautioned that failure to implement urgent interventions could lead to factory shutdowns, job losses, reduced industrial output, and a major setback to Nigeria’s industrialisation drive.
“We cannot control global geopolitics, but we can control our domestic response,” Ajayi-Kadir reiterated, urging policymakers to treat the situation as both a crisis and an opportunity to reposition Nigeria’s manufacturing sector for long-term sustainability.
US-Iran Conflict: MAN Outlines Urgent Steps to Shield Nigerian Manufacturers
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