IMF cautions FG against budget passage delays, fiscal overlap - Businessday NG

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The International Monetary Fund (IMF) has cautioned Nigeria against delays in budget approval and the practice of overlapping fiscal cycles, warning that both could undermine budget implementation and fiscal transparency as the government embarks on a more expansionary spending plan for 2026.

In its latest Article IV consultation report on Nigeria, the Fund said timely passage of budgets and a gradual phase-out of overlapping budgets would strengthen fiscal management, improve expenditure execution and enhance the government’s ability to use fiscal policy as an effective macroeconomic tool.

The warning comes as President Bola Tinubu’s administration implements a 2026 federal budget that the Fund estimates will widen the federal government’s fiscal deficit to 4.4 percent of gross domestic product, from 3.5 percent in 2025.

The IMF noted that the 2026 budget was signed only in mid-April, while implementation of the 2025 budget has been extended until the end of September 2026, creating an overlap between fiscal cycles.