Nigeria improved its fiscal position in Q3 2025, cutting the deficit to ₦330 billion.
As a result, stronger revenue inflows and tighter spending controls eased fiscal pressure from 2024.
Accordingly, the Budget Office reported that the government closed the quarter below projections.
Instead, policymakers contained the expected shortfall and delivered a smaller fiscal gap.
Overall, revenue and expenditure dynamics produced a ₦330 billion deficit in Q3 2025.
Fiscal Improvement Strengthens Outlook
Consequently, this outcome reduced the gap by ₦3.20 trillion, or 90.68%, from projections.
Moreover, this result strengthened Nigeria’s public finance position significantly during the review period.
In contrast, Q3 2024 recorded a much higher deficit of ₦3.17 trillion.
Meanwhile, the deficit-to-GDP ratio dropped to 2.29%, staying within the 3% limit.
To finance the gap, the government actively deployed ₦970 billion in domestic borrowing.
In addition, it mobilised ₦120.61 billion from privatisation proceeds.
Furthermore, it secured ₦3.13 trillion through multilateral and bilateral project-tied loans.
Notably, officials credited stronger revenue mobilisation for driving the fiscal improvement.
At the same time, tax reforms increased efficiency in revenue collection systems.
Similarly, government agencies boosted remittances from state-owned enterprises.
In parallel, authorities reduced leakages in public finance Management Systems.
However, fiscal pressures still persist due to debt servicing and inflation.
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Debt pressures Remain sSgnificant Challenge
Meanwhile, weak oil revenues and subsidy costs continue to strain the budget.
Additionally, exchange rate volatility intensifies fiscal instability across the economy.
Consequently, the government relies heavily on borrowing to finance infrastructure spending.
Borrowing Reliance Continues Fiscal Strain
Meanwhile, reforms such as subsidy removal aim to strengthen revenue generation.
Likewise, tax policy changes support long-term fiscal sustainability goals.
Earlier, Nigeria recorded a ₦13.51 trillion deficit in 2024, exceeding targets.
Similarly, the Federal Government raised ₦11.89 trillion in new borrowings in 2025.
However, capital expenditure reached only ₦3.10 trillion during the same period.
Specifically, borrowing included ₦7.08 trillion domestic and ₦4.81 trillion external loans.
Finally, authorities planned to increase borrowing to ₦29.20 trillion in 2026.
