AMID growing concerns by many Nigerians over the continued implementation of the 2024 budget till December 31, 2025, as against that of 2025, the International Monetary Fund, IMF has sounded a note of warning on the possibility of the nation’s fiscal outlook for 2025 running into serious threat in the course of implementing the current year’s budget. According to the United States of America-based financial institution, the country must urgently revise its budget targets or face a deepening financial crisis.
The specialized financial agency hinged its fears on the nation’s budget of N54.99 trillion which it views as lacking enough credible provisions for funding. The body’s latest Article IV consultation report, released on Wednesday, the 2nd day of July, 2025 pointed out that the country faces significant risk exceeding her fiscal deficit projections for the year, driven by a combination of falling oil prices, lower production levels, and challenges in capital expenditure execution.
Without mincing words, the IMF appears to be affirming the earlier position held by the World Bank which described the country’s 2025 federal budget as overly ambitious, warning that the Federal Government may be forced to turn to the CBN’s Ways and Means facility to finance likely revenue shortfalls.
The IMF’s postulations did not end without it paying glowing tributes to Nigeria’s economic issues handlers, particularly the finance minister and coordinating minister of the economy, Dr. Wale Edun. The global organisation praised the country’s significant economic reforms, recognising progress in the macroeconomic stability and resilience over the past two years. It placed special commendation on the Central Bank of Nigeria, CBN for maintaining a tight monetary policy to combat inflation and welcomed reforms aimed at strengthening the banking system, enhancing financial inclusion, and promoting capital market growth.
In the estimation of the International Monetary Fund, these steps have resulted into improvements in the foreign exchange market, noting the stabilisation of the Naira and a reduction in inflation to 23.7 per cent in April 2025, as against 31 per cent for the same month in 2024.
While appreciating IMF’s commendable financial assessment of Nigeria’s moves towards economic growth, it is, also worthy to note that its position stands limited by the information available it on the country’s fiscal policies derived from many years of incomplete compliance with the guiding complex appropriation acts. Were it otherwise, the financial experts would have offered more economy-related counsels to president Bola Ahmed Tinubu.
For example, the nation complies with the budgetary allocation processes that originate from the executive arms of government through to their passages into law after debates to the signing of it by the originating arm – executive local government chairmen, governors and the president. Budget, being an instrument of governance that relies heavily on estimates often relapses into noticeable differences between the estimates and actuals in the different budget items and centres.
However, those that prepare budgets for public services seldom make adequate provisions for monitoring, controls, feedbacks and accountability, which are areas that ultimately give accurate accomplishments or otherwise of what budgets are meant for.
Though it appears harmless, the issue of implementing two or more budgets at the same time has remained an additional obstacle to budget performance monitoring. For instance, when President Bola Ahmed Tinubu took over the mantle of leadership in 2023, one of the first fiscal acts he undertook was the presentation of a supplementary budget of N2.1 trillion to the National Assembly, NASS. This was passed into law with the speed it desired. The budget provided for N100 billion each for the Federal Capital Territory, FCT and the Federal Ministry of Works. That of the ministry of works was to enable it carry out urgent palliative works on failed portions of the country’s federal roads.
The amount of N 50 billion each was later released to both ministries. Until date, it is not clear to citizens whether the other half of the budgets have been transferred to the budget centres. This is particularly worrisome as majority of the federal roads are still in pitiable conditions. It is also not clear to interested inhabitants of the country whether the ministries used exactly what was approved for them or retired unused funds back into government coffers. This painted scenario cuts across all the budget lines in the country.
Ordinarily, the executive arms of government determine local governments, states or national budgets and their corresponding revenue generation sources. But in the country’s 2025 budget, the president proposed for about N49 trillion with deficit of more than N9 trillion while the National Assembly jerked it up to N54.99 trillion without provision for additional sources for funding the extra deficit that arose there from. This ambitious input of the legislators is largely responsible for the fears being expressed by the IMF.
The case of Rivers state is a fiscally pathetic one. In December 2024, the suspended Governor SiminalayiFubara proposed and got the three -man State House of Assembly’s approval of N1.88 trillion as budgetary estimate for 2025 fiscal year. This was upturned by the Supreme Court of Nigeria. All attempts to present it afresh to the Hon. Martin Amaewhule-led faction of the Assembly was rebuffed by the lawmakers until he was suspended in March and replaced with a sole administrator, Vice Admiral Ibok-EteEkweIbas.
Until now, a new proposal of about N1.48 trillion by Ibas is yet to be passed into law by the National Assembly partly because the retired Air Force officer is yet to explain the rationale behind the provision of a humongous sum of N24 billion for the installation of CCTV in the states’ Government House out of the total amount of N1.48 trillion estimated for the year. What this means is that Rivers State is currently being run without any fiscal plan known to law. And it is an anathema in credible democratic governance.
Achieving good governance around the world, to a great extent requires successful implementation of credible fiscal plans put in place by any nation. It therefore behooves the International Monetary Fund, IMF to further have a closer holistic look at Nigeria’s budgetary attitude with a view to offering more budgetary counsels that are consistent with global best practices, especially in the area of economic planning.
