April 24, 2025/CSL Research
The Central Bank of Nigeria (CBN) has released its Economic Report for January 2025, providing insights into key developments across the real, fiscal, financial, and external sectors of the economy. In the fiscal sector, provisional data for January 2025 indicated a significant decline in gross Federation Account earnings, driven by reduced revenues from both oil and non-oil sources.
Gross receipts stood at ₦1,943.38 billion, representing a 31.35% decrease compared to ₦2,830.97 billion recorded in December 2024, and falling 35.22% short of the ₦3,000.01 billion budgeted benchmark for the period. Non-oil revenue remained the largest contributor to gross Federation Account earnings in January 2025, accounting for 68.67% of total revenue at ₦1,334.52 billion while oil revenue contributed 31.33% of total receipts, amounting to ₦608.85 billion.
This reflected a steep 45.45% drop from ₦1,116.19 billion in December 2024 and fell significantly short—by 65.55%—of the monthly target of ₦1,767.19 billion. The sharp decline in oil revenue was largely attributed to reduced receipts from petroleum profit tax (PPT) and royalties, as well as production disruptions caused by shut-ins from ageing oil pipelines and installations.
During the review period, the Federal Government of Nigeria (FGN) experienced a sharp decline in retained revenue, which fell to ₦483.47 billion—a 69.19% decrease from the previous month. This drop was largely driven by lower receipts from federal government independent revenue and a reduced share of exchange gains. Concurrently, total government expenditure declined to ₦1,617.18 billion, representing a 15.51% month-on-month decrease, primarily due to delays in capital releases and reduced recurrent spending.
As a result, the fiscal position of the FGN worsened in January 2025. Provisional data revealed that the government recorded a primary deficit of ₦437.44 billion, a reversal from the fiscal surplus of ₦351.48 billion posted in December 2024. The overall fiscal deficit surged by 228.81%, rising to ₦1,133.71 billion from ₦344.79 billion the previous month. These developments underscore the urgent need to expand Nigeria’s fiscal space by boosting non-oil revenue sources. This is particularly critical as external risks—such as falling global crude oil prices and weaker-than-expected domestic oil production continue to undermine the country’s oil revenue performance.
Click here to download full report: CSL Nigeria Daily – 24 April 2025 – Government Revenue.pdf
