The Federal Government’s budget deficit has risen to 7.5 per cent of the country’s Gross Domestic Product as of August 2024, reflecting a significant widening of the gap between government revenue and expenditure.
A member of the Central Bank of Nigeria Monetary Policy Committee, Muhammad Abdullahi, disclosed this in his personal statement at the 297th MPC meeting. The document was published on the website of the central bank.
This was as the CBN economic report revealed that Nigeria’s fiscal deficit surged to N4.53tn in the second quarter of 2024, up from N3.88tn in the previous quarter.
In simple terms, a fiscal deficit happens when a government’s spending exceeds its revenue from taxes and other sources. It means the government is spending more money than it’s bringing in.
To cover this gap, the government often borrows money, which can lead to an increase in public debt.
Abdullahi said this development underscores the…