Nigeria settles over N2tn in 2024 capital budget obligations, boosting states’ fiscal capacity and aiming for timely 2025 releases

In a significant fiscal move, the Nigerian government has settled over N2 trillion in outstanding capital budget obligations from the 2024 fiscal year, signaling a commitment to fiscal discipline and timely project execution.

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Finance Minister Wale Edun announced this development during a press briefing in Abuja, emphasizing that there are no pending obligations left unprocessed.

“We have no pending obligations that are not being processed and financed,” Edun stated. “The focus will now shift to 2025 capital releases.”

This clearance is part of broader efforts to enhance the fiscal capacity of state governments.

Since the first half of 2023, the combined fiscal balance of states has grown from 1.8% of GDP to 3.1%, increasing from N2.8 trillion to N7.1 trillion.

This surplus provides states with greater capacity to invest in capital projects, thereby stimulating economic growth at the subnational level.

Edun highlighted that government agencies must only commit to capital projects when funds have been duly authorized, stressing the importance of financial discipline in public procurement.

Looking ahead, the government aims to implement Nigeria’s most comprehensive tax reform from January 2026.

This reform will consolidate all tax laws into a single framework, eliminate over 50 overlapping taxes, and simplify compliance processes.

Additionally, a revenue optimization and assurance platform will leverage technology and artificial intelligence to centralize collections, block leakages, and strengthen financial intelligence.

The administration’s medium-term goal remains to achieve 7% annual GDP growth, driven by investments in agriculture, education, health, manufacturing, technology, and infrastructure.

Efforts to attract private capital into infrastructure projects, such as the Third Mainland and Carter bridges in Lagos through public-private partnerships, are underway.

On the energy front, the government aims to increase power generation to 6,000 megawatts by the end of the year and complete the Ajaokuta-Kaduna-Kano gas pipeline to support industrial expansion.

Direct cash transfers to vulnerable Nigerians are ongoing, with eight million of the targeted 15 million beneficiaries already reached through three rounds of payments.

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Edun concluded by reaffirming the government’s commitment to building an economy that works for everyone with transparency, resilience, and purpose.