The Central Bank of Nigeria (CBN) has revealed that Nigeria’s capital expenditure for the first half of 2024 dropped by 25.3 per cent to N1.99 trillion, down from N2.68 trillion in the corresponding period of 2023.
The CBN in its statistical bulletin showed that there was a shift in spending priorities towards recurrent costs and debt servicing.
The report showed that CAPEX began with zero allocation in January 2024, compared to N379.1 billion in January 2023, suggesting a sluggish start to the fiscal year.
Spending rose in February 2024 with N893.9 billion, representing a significant increase from the previous month but still only 36.3 per cent higher than N656.3 billion spent in February 2023.
However, CAPEX dropped sharply in March 2024 to N258.6 billion, reflecting a 65 per cent decline from February 2024 and a 66.1 per cent decrease compared to March 2023’s N763.6 billion.
In April 2024, capital spending amounted to N42.1 billion, marking a 36 per cent drop from the N64.5 billion spent in the corresponding month in 2023.
It further indicated that in May and June 2024, CAPEX rose to N478.9 billion and N325.4 billion, respectively, but still lower than the corresponding months of 2023, when N300 billion and N513.3 billion were allocated.
Capital expenditure represented about 53.35 per cent of the N3.73tn retained revenue in H1 2024, a drop from the 96.06 per cent share in H1 2023.
Total government expenditure, however, rose by 29.5 per cent from N9.39 trilion in H1 2023 to N12.17 trilion in H1 2024, driven largely by recurrent spending.
Recurrent expenditure rose by 51.4 per cent, hitting N10.17 trillion in H1 2024 from N6.72 trillion in H1 2023.
Debt servicing gulped 68.2 per cent of the amount, which soared by 68.8 per cent, reaching N6.04 trillion compared to N3.58 trillion a year earlier.
Personnel costs also increased by 17.6 per cent to N2.32 trillion, further squeezing funds available for capital projects.
The widening gap between revenue and expenditure resulted in a 28 per cent rise in the fiscal deficit, which expanded from N6.59tn in H1 2023 to N8.44tn in H1 2024.
