The International Monetary Fund (IMF) has raised concerns over Nigeria’s fiscal reporting, saying government spending equivalent to about two per cent of the country’s Gross Domestic Product (GDP) was not captured in recent budgets.
Speaking at a meeting with business executives in Lagos on Wednesday, July 1, the IMF’s Resident Representative in Nigeria, Christian Ebeke, said the omission created a gap between the country’s reported fiscal deficit and its actual financing requirements.
According to Ebeke, the reported budget deficit appears lower than the government’s true borrowing needs because some capital expenditure was excluded from official budget documents and implementation reports.
He explained that part of the missing expenditure was linked to major government projects executed outside the formal budget framework, making it more difficult to accurately assess Nigeria’s fiscal position and the level of public investment.
“So far we think that there are about 2% of GDP of expenditure that were not reported that should be reported and should be recorded, so that this statistical discrepancy will disappear,” Ebeke said.
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He noted that incomplete fiscal reporting also makes coordination between fiscal and monetary authorities more difficult because policymakers may not have a complete picture of the government’s financing needs.
Ebeke disclosed that Nigerian authorities have already begun addressing the issue by revising and repealing aspects of recent budget laws to accommodate previously omitted expenditure.
He added, however, that updated budget implementation reports would still be required to fully reflect the adjustments.
The IMF official stressed that greater fiscal transparency is critical, warning that off-budget spending raises concerns about procurement practices, accountability and effective oversight.
His remarks follow the IMF’s latest Article IV consultation on Nigeria, in which the fund praised the Federal Government’s recent economic reforms for improving macroeconomic stability and boosting investor confidence.
The IMF, however, cautioned that the benefits of those reforms have not yet translated into significant improvements in living standards and warned that external risks, including ongoing tensions in the Middle East, could undermine recent economic gains.