President Bola Ahmed Tinubu on Wednesday, December 18, presented Nigeria’s 2025 budget, christened the “Budget of Restoration: Securing Peace, Rebuilding Prosperity,” to a joint session of the National Assembly. The proposed budget, pegged at N47.9 trillion, features an exchange rate benchmark of N1,500 per dollar, aiming to consolidate the administration’s economic restructuring efforts.
Tinubu highlighted that the budget seeks to strengthen policies aimed at boosting human capital development, increasing trade and investments, revitalizing the manufacturing sector, and enhancing oil and gas production. The overarching goal is to increase Nigeria’s economic competitiveness and foster macroeconomic stability.
Key Budget Targets
The 2025 budget outlines projected revenue of N34.82 trillion and government expenditure of N47.90 trillion, resulting in a deficit of N13.08 trillion, which represents 3.89% of the nation’s gross domestic product (GDP). Debt servicing is estimated at N15.81 trillion.
Key assumptions include crude oil production at 2.06 million barrels per day (mbpd), a drop in inflation from the current 34.6% to 15% by 2025, and an improvement in the naira-dollar exchange rate from N1,700 to N1,500.
Sectoral allocations include:
- Defence and Security: N4.91 trillion
- Infrastructure: N4.06 trillion
- Health: N2.48 trillion, with N402 billion earmarked for infrastructure and N282.65 billion for the Basic Health Care Fund.
- Education: N3.52 trillion, with N826.90 billion dedicated to infrastructure, including nine new institutions.
Tinubu emphasized that the projections are underpinned by increased export of finished petroleum products, reduced reliance on food imports, improved security leading to bumper harvests, and greater foreign exchange inflows from portfolio investments. Higher crude oil output and a reduction in upstream oil and gas production costs are also key contributors to the optimistic projections.
Securing the Nation
Tinubu stressed the government’s commitment to enhancing national security, with increased funding for military, paramilitary, and police forces. “We will provide our security forces with modern tools and technology to ensure they keep us safe. Boosting the morale of our men and women in uniform remains a top priority,” he stated.
Economic Ambitions
The President described the budget as ambitious but necessary, designed to foster inclusive growth, reduce poverty, promote equitable income distribution, and enhance the business environment.
Criticisms and Concerns
Despite the government’s optimism, some economists have expressed skepticism. Development economist Kalu Aja described the budget as “borrowing dollars to fund salaries and debt servicing, while praying for increased oil exports.” He noted that the success of the budget might hinge on the operational performance of the Dangote Refinery, which is expected to boost petroleum product exports and reduce import reliance.
The 2025 budget, Tinubu asserts, will position Nigeria for economic recovery and prosperity, while critics remain cautious about its reliance on optimistic revenue forecasts and external factors.