Experts Prescribe Measures to Make 2025 Budget Effective

Oluchi Chibuzo

Experts from the Nigerian Institute of Social and Economic Research (NISER), Ibadan and Nigeria Economic Society (NES) have said that the 2025 budget can positively impact businesses and the nation’s economy if some concerns over its implementation are well addressed.

This was the submission of the experts at a seminar titled, ‘Impact of the 2025 Budget on the Business and Economic Sector’ held  at  The Chartered Institute, Victoria Island, Lagos, recently.
The Guest Speaker/Chief Executive Officer, Centre for the Promotion of Private Enterprises (CPPE), Dr. Muda Yusuf, submitted that “fixing structural challenges through infrastructure spending in the budget can impact positively on the economy and private sector.”

He added that “businesses could benefit from the contracting and procurement activities as service providers or suppliers once spending commences.”
Yusuf further explained that while “high government borrowing may hurt the private sector because of the crowding out effect in the credit market by government, it offers attractive low risk investment in government securities to investors in financial instruments.”

He also said “government spending priorities for security is good for the investment environment and it typically has higher impact in social sector spending – education, health, environment.”
Despite the optimism expressed over the 2025 budget, concerns were raised regarding implementation of the budget.  

According to the speaker, “As of the first quarter of 2024, implementation of the 2023 capital budget was still ongoing, while that  of 2024 was yet to commence according to the budget implementation report of the Budget and National Planning Ministry. Inevitably, the 2025 budget will also be rolled over to 2026.

Apart from the concerns over implementation, Yusuf further submitted that “we need to separate infrastructure spending from the capital budget to enable a better assessment of government commitment to infrastructure development, which is a major desire of the private sector.”

Speaking earlier, the Director-General of NISER, Prof. Antonia Simbine said, “that the Nigerian economy is in transition triggered by the set of policies initiated a little less than two years ago and that the needle has moved in certain areas and the economy may have been profoundly reshaped.”

In spite of the optimism she expressed, the erudite scholar pointed out that “The 2025 Nigeria federal budget is the biggest ever in local currency terms amounting to N54.99 trillion to be funded through Debt (69 per cent), Loans (28 per cent) and Asset sales (2 per cent) with priorities on Defence and Security, Infrastructure, Education, and Health.”
This, according to her, “will normally generate conversations that border on late passage of the budget, the realism or (lack of) the underlying parameters especially the 15 per cent inflation target, the large fiscal deficits, the dependence on debt-finance, others.”

The discussants which included Professors Salamatu Isah from Ahmadu Bello University, Risikatu Dauda from University of Lagos, Bongo Adi from Pan-Africa University, and Dr. Patrick Ejumedia, agreed that timely implementation of 2025 budget could be a game-changer for businesses and the nation’s economy.

In his closing remarks, the NES President, Prof. Adeola Adenikinju, called for fiscal discipline, efficiency in public expenditure and innovative approaches to revenue mobilisation, including leveraging technology and broadening the tax base while ensuring that tax policies do not stifle productivity and business growth.