Nigeria left out public spending worth almost 2% of its GDP from recent official budgets, the International Monetary Fund has said, reopening questions about the country’s budget transparency just as lawmakers push through a record N68.3 trillion spending plan for 2026.
Christian Ebeke, the IMF’s resident representative in Nigeria, made the disclosure on Wednesday while addressing business executives in Lagos. He said the gap has masked the true scale of government borrowing against what was officially reported as the fiscal deficit.
“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 told the gathering, according to Reuters.
Vanguard put the figure at roughly N8.83 trillion, working off a 2025 nominal GDP of N441.5 trillion. That is a sizeable sum sitting outside formal budget documents and implementation reports, and it goes to the heart of Nigeria’s budget transparency problem: large capital projects executed off-budget, which Ebeke said distort assessments of the country’s real fiscal position.
The mechanics matter here. When capital spending never shows up in a budget line, the reported deficit looks smaller than actual borrowing. Government financing needs stay hidden until they surface elsewhere, in debt figures or in the books of state agencies running their own intervention funds. That mismatch is what economists call a statistical discrepancy, and it is precisely what Ebeke wants closed.
There is some movement already. Ebeke said Nigerian authorities have started repealing and revising budget laws to bring previously unrecorded spending back into the official record. He was careful to note this is only a first step. Updated implementation reports, the documents that show whether allocated money was actually spent and on what, are still outstanding. Without those reports, efforts to improve budget transparency remain incomplete.
Improving budget transparency, Ebeke argued, is not just an accounting exercise. Off-budget spending raises separate concerns about procurement practices and institutional oversight, since projects that bypass the budget process often bypass the scrutiny that comes with it too.
The timing is notable. The IMF’s warning lands weeks after Nigeria’s National Assembly approved the 2026 Appropriation Bill at N68.32 trillion. The concerns raised over budget transparency become more significant when viewed against the scale of planned borrowing.
Budgit Foundation analysis puts the projected deficit at N23.85 trillion against revenue of N34.3 trillion, meaning the government plans to borrow close to N70 for every N100 it expects to earn. The Senate has also cleared a fresh $6 billion external loan package, including $5 billion from Abu Dhabi’s First Abu Dhabi Bank for budget support and debt servicing.
Set against that borrowing trajectory, an unreported 2% of GDP is not a rounding error. It is the difference between the deficit lawmakers debate in Abuja and the deficit the country is actually financing. That gap underscores why budget transparency has become a central issue in the IMF’s assessment of Nigeria’s public finances.
Ebeke’s remarks followed the IMF’s latest Article IV consultation on Nigeria, which credited the federal government’s macroeconomic reforms, including foreign exchange liberalisation and fuel subsidy removal, with strengthening economic stability and investor confidence. But the Fund also cautioned that these gains have yet to reach ordinary Nigerians in any broad-based way, and warned that external shocks, including the Middle East conflict, could still undermine the progress made so far.
Nairametrics reported that the Fund separately flagged concerns over Nigeria’s plan to raise up to $5 billion through a derivatives-based financing arrangement with First Abu Dhabi Bank, warning that such transactions are often opaque and complex, a point that reinforces the broader budget transparency theme running through the IMF’s engagement with Abuja this year.
For a government trying to convince investors and multilateral lenders that its reforms are durable, strengthening budget transparency is now central to restoring fiscal credibility. Fiscal credibility depends on the numbers matching reality. Until unrecorded capital spending is fully brought back into official budget documents, Nigeria’s deficit figures will keep understating what the country actually owes and spends.
