Nigeria’s petrol subsidy reforms freed N15.8 trillion in resources for the federation between June 2023 and December 2025, Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele, has disclosed.
Oyedele made the disclosure on Wednesday during a media briefing on the government’s reform scorecard covering the period from 2023 to 2026.
According to him, the resources were reflected in increased revenue collections, particularly as the naira value of dollar-denominated transactions rose following the implementation of foreign exchange reforms.
He said the Federal Government received N5.4 trillion of the N15.8 trillion, while N10.4 trillion was distributed among state and local governments.
Oyedele also disclosed that the Federal Government raised an additional N3.1 trillion in independent revenue during the period, largely driven by increased remittances from government-owned entities.
He said the government’s total additional resources from subsidy savings, independent revenue and borrowing amounted to N20.4 trillion.
The minister said the figure included N11.9 trillion in additional borrowing, adding that the amount would have been significantly higher without the fiscal space created by the reforms.
Oyedele further disclosed that the Federal Government recorded N30.64 trillion in additional expenditure during the period.
He said N9.39 trillion was spent on wage adjustments, minimum wage increases and allowances for public servants, while N9.37 trillion went towards servicing external debt.
Another N6.5 trillion, he said, was allocated to strategic infrastructure.
Oyedele noted that the increase in government spending on wages exceeded the Federal Government’s entire share of the resources freed through petrol subsidy reforms.
He attributed the sharp rise in external debt-servicing costs largely to the depreciation of the naira.
According to him, although the dollar value of Nigeria’s foreign debt remained unchanged, servicing the obligations required significantly more naira following the currency’s depreciation.
He illustrated the impact by noting that a $1 million interest payment that previously cost about N460 million would now require roughly N1.415 billion.
Oyedele stressed that Nigeria could not simply defer its debt obligations, warning that failure to meet them could have serious economic consequences.
He said the figures demonstrated that the reforms were not primarily introduced to increase government revenue.
Rather, he explained that the reforms were designed to address longstanding corruption, inefficiencies and distortions in the fuel subsidy and foreign exchange markets.
Goodness Anunobi
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