The federal government has clarified that the N13 trillion deficit in the proposed N48 trillion 2025 budget will be financed through borrowing.
The Minister of Finance and Coordinating Minister for the Economy, Wale Edun, provided clarification on Monday after the Federal Executive Council (FEC) meeting, which was presided over by President Bola Ahmed Tinubu at the State House in Abuja.
Edun outlined the government’s financial plans for the coming year, revealing that the projected revenue for 2025 is estimated at N34.82 trillion, with total expenditure set at N47.96 trillion. This marks a 36.8% increase from the 2024 budget, resulting in a deficit of N13.14 trillion, or 3.89% of Nigeria’s Gross Domestic Product (GDP).
He explained that the 2025 budget reflects the administration’s achievements over the past 18 months, with a focus on fiscal sustainability and economic growth. Edun stressed the importance of balancing revenue, expenditure, and borrowing to foster an environment conducive to economic expansion.
“Like governments around the world, we are concerned about achieving fiscal sustainability. It is about creating a balance between revenue, expenditure, and borrowing to foster an economy that can grow sustainably,” he said.
The minister emphasized the importance of private-sector investment in driving growth, creating jobs, and reducing poverty. He pointed out that economies like Nigeria’s, which are led by the private sector, depend on investors to finance projects that boost productivity and foster economic expansion.
“Investors play a critical role in boosting productivity, creating jobs, and bringing people out of poverty. Our reforms are aimed at creating an environment where private sector investment can thrive,” Edun explained.
He cited recent reforms under President Tinubu’s administration, including the removal of petroleum subsidies, market-driven foreign exchange policies, and electricity tariff adjustments, as key factors driving economic improvement.
Edun also pointed to growing investor confidence in the Nigerian economy, referencing announcements by Shell and Total of multi-billion-dollar investments in the country.
“These investments signal renewed confidence in our economy and are a testament to the government’s ongoing reform agenda,” he noted.
The minister underscored that the 2025 budget prioritizes essential government spending while fostering private-sector-led investments.
He also highlighted a significant milestone in the energy sector, with Nigeria resuming domestic refining of petroleum products for the first time in 25 years.
“For the first time in about 25 years, we are refining petrol domestically, not just for fuel but also as raw materials for industries like pharmaceuticals, construction, and textiles,” he added.
