April 3, 2025/CSL Research
The Central Bank of Nigeria (CBN) recently released its Economic Report for the fourth quarter of 2024, providing an overview of key developments in the real, fiscal, financial, and external sectors of the Nigerian economy.
In the fiscal sector, provisional data for Q4 2024 showed an increase in gross federation account earnings, primarily driven by higher oil revenue. Total receipts for the quarter amounted to ₦7,230.08 billion, reflecting a 5.31% rise from the ₦6,865.84 billion recorded in Q3 2024. However, this figure remained 19.67% below the budgeted target of ₦9,000.02 billion.
Non-oil revenue accounted for 72.28% of total gross federation account earnings in Q4 2024, amounting to ₦5,225.77 billion. While this represented a 6.03% decline from the ₦5,560.87 billion recorded in Q3 2024, it exceeded the budget target of ₦3,698.46 billion by 41.30%. The drop compared to the previous quarter was primarily due to lower corporate tax collections, reflecting the seasonal impact of tax return filings by companies. Oil revenue contributed 27.72% of total receipts, amounting to ₦2,004.31 billion. This marked a significant 53.59% increase from ₦1,304.96 billion in Q3 2024 but remained 62.19% below the budget target of ₦5,301.56 billion. The rise in oil revenue was largely attributed to enhanced security measures protecting oil infrastructure, which led to increased collections from petroleum profit tax (PPT) and royalties.
The Federal Government of Nigeria (FGN) saw an increase in retained revenue during the review period, driven primarily by higher receipts from its share of excess non-oil revenue and independent revenue. Meanwhile, the FGN’s aggregate expenditure rose due to higher personnel costs and interest payments. Total spending for Q4 2024 amounted to ₦5,604.79 billion, representing a 2.22% increase from ₦5,482.94 billion in Q3 2024 but falling 22.09% short of the budgeted target of ₦7,194.35 billion.
The Federal Government of Nigeria (FGN) recorded a narrower fiscal deficit in Q4 2024, driven by increased revenue relative to expenditure. Provisional data showed that the primary deficit declined by 22.62% quarter-on-quarter to ₦885.94 billion, down from ₦1,144.93 billion in Q3 2024. Similarly, the overall fiscal deficit fell by 3.61% to ₦3,084.97 billion from ₦3,200.40 billion in the previous quarter. Despite this improvement, further efforts are needed to enhance the fiscal space through diversified revenue sources, particularly in the non-oil sector. Additionally, ongoing measures to boost domestic oil production beyond the near-term target of 2.1 million barrels per day (mbpd) remain crucial for strengthening fiscal sustainability.
Click here to download full report: CSL Nigeria Daily – 03 April 2025 – Government Revenue.pdf
