Nigeria’s fiscal deficit ballooned to ₦13.51 trillion in 2024, surpassing the government’s official target and breaching the3.0% legal limitof theFiscal Responsibility Act (FRA) 2007, according to theBudget Implementation Reportreleased by theBudget Office of the Federation.
The report revealed that under the 2024 Fiscal Framework, the quarterly fiscal deficit was initially projected atN2.29 trillion, excluding the operations of Government-Owned Enterprises (GOEs)andmultilateral or bilateral project-tied loans estimated at N262.98 billion.
However, fiscal pressures — driven by elevated public spending, rising debt servicing costs, and weaker-than-expected revenues — caused actual figures to exceed projections significantly.
In the fourth quarter of 2024 alone, Nigeria recorded a deficit of N7.17 trillion, representing an overshoot ofN4.88 trillionor 212.68%above the prorated budget target for the period.
“Overall, a total of N13.51 trillion deficit was recorded in 2024, representing a budget-to-GDP ratio of 3.62 per cent, which is above the 3.0 per cent threshold stipulated in the Fiscal Responsibility Act 2007,” the Budget Office stated.
The report further explained that the deficit was financed through multiple borrowing channels, including: N1.98 trillion from Multilateral/Bilateral Project-Tied Loans; N6.06 trillion from Domestic Borrowing; N3.37 trillion from Foreign Borrowing, and; N3.19 trillion from Budget Support funds.
The widening deficit underscores Nigeria’s persistent fiscal imbalance, which continues to be driven by rising recurrent expenditure, subsidy costs, and suboptimal non-oil revenue performance.
According to the International Monetary Fund (IMF), Nigeria’s fiscal gap is projected to expand further in 2025. The Fund estimates a consolidated fiscal deficit of 4.7% of GDP, citing declining oil prices, reduced production output, and lower-than-expected capital spending as key drivers.
By the end of the third quarter of 2024, Nigeria’s fiscal deficit had already reached N7.05 trillion, signaling the government’s heavy reliance on borrowed funds to sustain spending on infrastructure, subsidies, and public sector obligations.
This trend has contributed to a sharp rise in Nigeria’s public debt stock. Data from the Debt Management Office (DMO) show that total public debt rose to N152.40 trillion as of June 30, 2025, up from N149.39 trillion at the end of March — marking a N3.01 trillion (2.01%) quarterly increase.
In dollar terms, Nigeria’s debt stock climbed from $97.24 billion to $99.66 billion, reflecting a 2.49% rise.
Nigeria’s debt portfolio comprises bilateral obligations to countries such as China, France, Germany, and Japan, and multilateral loans from institutions including the World Bank, African Development Bank (AfDB), and Islamic Development Bank (IsDB).
Domestically, the Federal Government continues to raise funds through instruments such as FGN Bonds, Treasury Bills, Sukuk Bonds, Green Bonds, and Promissory Notes — a strategy that has helped finance spending gaps but also deepened debt servicing pressures.
Analysts warn that unless Nigeria improves its revenue mobilization, public expenditure management, and oil sector productivity, the widening deficit and rising debt profile could further strain fiscal sustainability in the coming years.
