Minister of Budget and Economic Planning, Senator Abubakar Atiku Bagudu, yesterday declared that the federal government has adhered to the legal borrowing limit of 5 percent from the Central Bank of Nigeria (CBN) despite challenges in the domestic and global economic environment.
The minister said Nigerians are already appreciating the gains of key reforms so far implemented by the President Bola Tinubu-led administration stressing that the president greatly appreciates Nigerians’ support for the reforms.
Bagudu who spoke at the 2025 KPMG/Arise News Budget Programme added that stability in the foreign exchange market and declining food inflation are evidence that Nigeria is reaping the gains of the reforms.
The minister allayed concerns over the country’s growing debt burden, assuring that the government would not exceed its legal borrowing limits, particularly from domestic sources.
Bagudu further assured that the federal government would adopt innovative financing methods, including local bonds and external borrowing, to meet its fiscal needs.
Bagudu also stressed that asset sales, a policy favoured by the government, would only be carried out when market conditions are optimal to maximise value.
Specifically, he said the government had been able to address the issues around insecurity which had prevented farmers from accessing their farms. As a result, he said there’s currently a boost in food production which had reduced food inflation.
He also pointed to the relative stability in the country’s Foreign Exchange market and and the deceleration in headline inflation as evidence that Tinubu’s policies were working.
Bagudu also noted reforms in the oil sector, including the removal of fuel subsidy had resulted to significant revenues to state governments to meet their fiscal obligations.
He said one of the key highlights of the 2025 budget was the full deregulation of the petroleum sector, the FX market, and reductions in electricity subsidies.
Bagudu further outlined government’s commitment to revitalising agriculture, which remains a priority sector for poverty reduction and inclusive growth.
He said the sum of N1.5 trillion had been allocated to the Bank of Agriculture (BoA) to provide much-needed financing for farmers, adding that international investors, particularly from Brazil and Saudi Arabia, are increasing their investments in the agricultural sector, with commitments totaling billions of dollars.
He said the current administration was committed to revitalising the solid mineral sector which had been underfunded despite institutional alignment.
The minister said, “With a N1 trillion allocation in the 2025 budget, the government aims to boost production and productivity in this sector, which is crucial for diversifying Nigeria’s economy.”
He also cited ongoing investments and development in various projects, including industrial-scale mining plants.
Nonetheless, the minister further expressed optimism that ongoing reforms, including the reduction in electricity subsidies through new tariff categories, would positively impact the nation’s oil production, security, and economic activity.
He noted that although the country had surpassed the oil production target of 2.1 million barrels per day, security remained a key challenge, with pipeline vandalism and other infrastructure concerns limiting output.
On oil prices, which recently dipped below $70 per barrel, Bagudu reassured Nigerians that while external pressure to cut oil production was rising, the government believed in the resilience of global demand.
He pointed out that despite a temporary decline, oil prices are expected to stabilise over the long term, with little immediate impact on Nigeria’s oil revenue assumptions for the 2025 budget.
On youth employment and education, Bagudu acknowledged the increasing pressure to provide jobs for the growing youth population.
He highlighted the government’s investment in education, which had seen a significant increase in funding for student loans.
Among other things, the minister emphasised that while education remained critical, the real challenge lied in ensuring that the labour market can absorb graduates.
Bagudu pointed to initiatives aimed at increasing youth participation in digital economic sectors, particular software engineering, where international demand was on the increase.
On healthcare, Bagudu acknowledged the rising demand for accessible healthcare, particularly in a country where most people rely on out-of-pocket spending for medical services.
He said government was increasing healthcare funding, with a focus on expanding access to professional coverage through job creation and economic growth.
Senior Partner at KPMG Nigeria/Chief Executive Officer KPMG West Africa, Tolani Adeyemi, expressed optimism that the 2025 budget could actually stimulate growth if well implemented.
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