The fiscal deficit of the Federal Government
Fiscal deficit of the federal government rose slightly by 0.1 percent, reaching N824.79 billion in April, up from N823.91 billion in March, as disclosed by the Central Bank of Nigeria (CBN) in its April 2024 Monthly Economic Report.
A fiscal deficit occurs when a government’s expenses surpass its revenues. According to the CBN report, the April deficit was 7.92 percent higher than the budgeted N764.19 billion for the period. The increase in the deficit was attributed to a 0.55 percent month-on-month decline in retained revenue, which dropped to N419.91 billion in April from N422.23 billion in March. This decline was primarily due to reduced receipts from exchange gains.
The report stated, “The fiscal operations of the Federal Government of Nigeria in April resulted in an expansion in the fiscal deficit.
Provisional data indicated that primary and overall deficits rose to N260.98 billion and N824.79 billion, respectively, from N249.43 billion and N823.91 billion in the preceding month. The expanded deficit reflected the sharper decline in retained revenue.”
Government expenditure
The expenditure also saw a slight month-on-month decline of 0.16 percent, falling to N1.246 trillion in April from N1.244 trillion in March, largely due to reduced capital spending. The report noted that expenditure was 0.12 percent below the previous month’s level and 48.10 percent lower than the projected spending of N2.398 trillion.
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The CBN also highlighted a significant reduction in consumer credit outstanding, which fell by 53.83 percent to N3.8 trillion at the end of April 2024, compared to the previous month. This decline was driven by a 60.79 percent decrease in personal loans, which dropped to N2.95 trillion. In contrast, retail loans saw an 18.81 percent increase, reaching N856.77 billion. Personal loans accounted for 77.48 percent of total consumer credit, with retail loans making up the remainder.
