Despite earning over N21.22tn from its top revenue-generating agencies in the first half of 2025, the Federal Government has continued to pursue foreign loans to plug budget deficits and fund key projects.
According to The PUNCH, figures obtained from financial submissions made to the Federation Accounts Allocation Committee, show that the Federal Inland Revenue Service, Nigeria Customs Service, Nigerian Upstream Petroleum Regulatory Commission, Ministry of Mines and Steel Development, and the Nigerian National Petroleum Company Limited, collectively raked in N21.22tn between January and June.
The surge in inflows was attributed to stronger tax collections, rising oil royalties, and improved customs duties, signalling a more aggressive revenue drive by the current administration.
The FIRS had the highest earnings at N13.76tn, followed by the NUPRC which collected N5.21tn from oil royalties and associated payments. The NCS contributed N2.02tn from import and excise duties.
Revenues from the Ministry of Mines and Steel Development amounted to N32.39bn, while NNPC Ltd reported N197.8bn from its commercial ventures, even though its statutory remittances to FAAC stood at a much higher N6.96tn.
An official of the Budget Office who spoke on condition of anonymity said, “These numbers show that the reforms in revenue-generating agencies are paying off. The government is on track to exceed its yearly revenue target.”
However, experts are concerned that the strong revenue performance has not slowed the government’s appetite for borrowing.
Data from the Debt Management Office indicate that Nigeria’s public debt stood at N149.39tn as of March 31, 2025 — up from N121.67tn in the same period of 2024.
Development economist, Aliyu Ilias, expressed worry over the country’s rising loan portfolio.
“Borrowing is not bad in itself,” he said, “but why do we need to amass more loans when revenues are reportedly rising? What message does that send about fiscal discipline?”
He added that the removal of fuel subsidy and elevated tax earnings should ease the need for fresh borrowing.
“Debt servicing is beginning to crowd out infrastructure spending and essential services. That is what many Nigerians are worried about,” Ilias said.
Economist and CEO of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, described the half-year revenue figures as encouraging.
“It shows the economy is gradually stabilising and the agencies are meeting expectations. With this trajectory, they are likely to surpass their targets by year-end,” he stated.
Yusuf noted that continued borrowing despite improved cash flow called for caution.
“If the revenue performance remains strong, we shouldn’t exceed the deficit threshold outlined in the budget. That is how to ease the pressure of debt servicing,” he said.
The 2025 budget, tagged “Budget of Restoration”, targets total revenue of N36.35tn for the year. With N21.22tn already realised in six months — about 58 per cent of the target — analysts say Nigeria is on course to outperform its fiscal projections, provided the momentum is sustained.
Nevertheless, with pending World Bank and other multilateral loans estimated at over $24bn expected to take Nigeria’s public debt close to N182tn by 2026, fiscal analysts insist there is a need for more prudent borrowing and better utilisation of available revenues going forward.