Macroeconomic Report & Economic Updates

October 4, 2018

Nigeria Economic Update (Issue 38)

The 2017 budget implementation report shows a paltry average performance in 2017, compared to the projections contained in the budget. The actual oil and non-oil revenue generated were N1.1 trillion and N957 billion respectively, considerably below the projected figures of N2.1 trillion1 and N1.4 trillion. Other revenue sources brought the total revenue generated to N2.7 […]

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The 2017 budget implementation report shows a paltry average performance in 2017, compared to the projections contained in the budget. The actual oil and non-oil revenue generated were N1.1 trillion and N957 billion respectively, considerably below the projected figures of N2.1 trillion1 and N1.4 trillion. Other revenue sources brought the total revenue generated to N2.7 trillion. However, on the expenditure side, the combination of personnel expenditure and debt repayments amounted to N3.5 trillion, which exceeded total revenue by N885 billion. This implies that Nigeria borrowed to pay salaries and service debts in 2017. As long as the culture of making unrealistic budget projections continues, we expect to record low budget implementation going forward. To address the wide gap between actual and expected budget performance, better forecast of future revenue alongside making less ambitious spending plans is critical.




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Nigeria Economic Update (Issue 34)

Recent NBS data shows a significant decline in power generated in 2016Q2. Precisely, power generated declined by 31 percent (quarter on quarter) from a total quarterly average of 92,352 MWH in 2016Q1 to 63,692.39 MWH in 2016Q2. Remarkably, the reoccurrences of pipeline vandalism in 2016Q2 prompted the shortage of gas for power generation. Thus, there were about eight recorded system collapses in the quarter which led to several days of power outages. However, subsequent quarterly declines in power generation could be averted if efforts to repair vandalized pipelines and adopt hydro sources are intensified.

Nigeria Economic Update (Issue 19)

A recent report by the National Bureau of Statistics (NBS) indicates that Internally Generated Revenue (IGR) at the subnational level decreased slightly between 2014 and 2015. Specifically, the report shows that on the average, the IGR of all 36 states declined by 3.6 per cent from N707.9 billion in 2014 to N683.6 billion in 20157. A further disaggregation reveals that while IGR in 11 states improved in 2015 compared to 2014, IGR in 24 states were below their 2014 levels. As expected, Lagos state generated the most IGR during the period. Given that domestic resource mobilization is the most viable alternative to complement the shortfalls (driven by lower oil prices) in budgetary allocations to states from the federal government, state governments need to do more to improve the effectiveness and efficiency of revenue collection.