The Central Bank of Nigeria’s monthly economic report for August revealed that the Federal Government experienced a fiscal deficit of N1.54tn in the first two months of the third quarter of 2023.
The deficits for July and August were N818.53bn and N726.85bn, respectively. This represented an 11.0 percent contraction compared to the preceding month and a 19.1 percent decline relative to the proportionate target for August. The report attributed the lower deficit to a decrease in interest payments during the period.
The Central Bank noted an increase in gross federation account revenue, reaching N1.69tn, a 1.7 percent improvement from the preceding month. However, this figure fell short of the N1.76tn benchmark by 3.9 percent.
The enhanced performance was driven by higher earnings from production sharing contracts, the 2023 interim dividend payment by the Nigerian National Petroleum Company Limited, and increased collections from customs & excise duties and FGN independent revenue.
Non-oil revenue continued to dominate the composition, accounting for 81.5 percent, while oil revenue constituted the remaining 18.5 percent. The report highlighted the positive impact of improved oil earnings on the fiscal situation, leading to a reduced fiscal deficit despite challenges in meeting the revenue benchmark.
