LAGOS— Nigeria’s fiscal deficit narrowed significantly to N330 billion in the third quarter of 2025, driven by improved revenue performance, tighter expenditure management, and easing fiscal pressures compared to last year.
Central Bank of Nigeria data highlights a remarkable macroeconomic turnaround, anchored by a robust $4.6 billion Balance of Payments surplus and gross external reserves climbing past the $42 billion threshold.
The fiscal consolidation reflects aggressive non-oil tax collections and a 44% surge in refined petroleum product exports, which injected $2.29 billion into the economy during the review period.
However, structural vulnerabilities persist as full-year fiscal assessments reveal the federal government faced a staggering N30 trillion revenue shortfall against its initial budgetary targets for the 2025 fiscal cycle.
Aggressive spending under the current administration kept broader borrowing high, pushing Nigeria’s total public debt to N153.29 trillion, according to recent updates from the Debt Management Office.
Crucially, debt servicing consumed N10.81 trillion in the first nine months of 2025, swallowing roughly 47.8 percent of the government’s N22.59 trillion retained revenue and capping deficit reduction velocity.
Looking forward into 2026, the fiscal landscape remains heavily pressured with the government projecting an expanded budget deficit of N23.85 trillion amid escalating recurring expenditures and high borrowing costs.
