In a newly released report, titled “2025 Fiscal Policy Priorities: Towards Improved Competitiveness in Southwest Nigeria,” the Development Agenda for Western Nigeria (DAWN) Commission provides detailed analysis of the 2025 budgets across Southwest Nigeria, highlighting significant expansion in fiscal spending and infrastructure development priorities.
National Budget Highlights
At the national level, the Federal Government has approved a ₦54.99 trillion budget for 2025, reflecting a 56.9% increase from the ₦35.05 trillion budget of 2024. Notably, capital expenditure has surged by 173.2% to ₦23.96 trillion, demonstrating a commitment to infrastructure development. Aggregate revenue projections stand at ₦36.35 trillion, marking an 85.46% increase from 2024. However, the allocation for debt servicing has risen to ₦14.31 trillion, raising concerns about fiscal sustainability. Key economic benchmarks include a crude oil production target of 2.06 million barrels per day (mbpd) and an exchange rate of ₦1500/$1.
Southwest Regional Highlights
The six Southwest states have collectively budgeted ₦6.60 trillion for 2025, marking a 56.03% increase from 2024. Lagos State leads with ₦3.36 trillion, followed by Ogun State at ₦1.007 trillion. The total capital expenditure stands at ₦3.77 trillion, surpassing the recurrent expenditure of ₦2.78 trillion, reflecting a strong commitment to long-term infrastructure projects. However, with revenue projections at ₦2.92 trillion, the region faces a substantial financing gap, necessitating deficit financing. All six states are prioritising infrastructure development and economic growth as key drivers for sustainable progress.
State-Specific Focus Areas
Lagos State
- Emphasis on THEME agenda (Traffic Management, Health, Education, Economy)
- Significant allocation to economic affairs (27%) and infrastructure development
- Focus on multi-modal transportation systems
Ogun State
- Infrastructure development receives 27% of the budget allocation
- Education (17%) and healthcare (13%) as priority sectors
- Strategic focus on industrialization and oil sector development
Ondo State
- Strong emphasis on infrastructure (27.27% allocation)
- Education (17.11%) and health (11.90%) as key priority areas
- Focus on blue economy and energy sector development
Oyo State
- Infrastructure and education receive combined 43.92% allocation
- Healthcare emphasis with 8.76% allocation
- Strategic focus on tourism and agricultural development
Ekiti State
- Focus on becoming an agro-allied export hub
- Significant investment in education (7.9%) and agriculture (6.27%)
- Airport development as a key infrastructure project
Osun State
- Infrastructure leads with 25.04% allocation
- Education (13.19%) and healthcare (7.18%) as priority sectors
- Emphasis on ease of doing business and citizen welfare
The report underscores the region’s commitment to infrastructure development and economic growth while highlighting the need for sustainable revenue generation and efficient budget implementation to achieve stated objectives.
Key Recommendations
The report outlines several critical recommendations for improved budget implementation:
- Enhanced focus on efficient capital expenditure execution
- Strengthening internally generated revenue mechanisms
- Better alignment of fiscal, monetary, and trade policies
- Improved governance and transparency in budget implementation
- Increased regional collaboration on shared infrastructure projects
Southwest Poised to Lead Nigeria’s Economic Recovery
Adesoji Farayibi, Head of the Economic Competitiveness Desk at DAWN Commission, emphasised the critical role of sub-national governments in driving Nigeria’s economic recovery. “The success of these fiscal policies hinges on prudent management, effective governance, and regional collaboration,” he stated.
The report concludes by highlighting the Southwest’s potential to lead Nigeria’s economic renaissance through innovative fiscal strategies and coordinated development efforts.
Download and read the full report to gain deeper insights into the fiscal priorities shaping the future of Southwest Nigeria.