Economists have backed the United States’ assessment that Nigeria failed to meet minimum fiscal transparency requirements, warning that weaknesses in budget implementation, public financial disclosure and auditing could undermine investor confidence and economic growth.
The reactions followed the 2026 Fiscal Transparency Report released by the US Department of State, which placed Nigeria among 67 governments that failed to meet the minimum requirements during the review period of January 1 to December 31, 2025.
The report, published on August 11, assessed 140 governments and entities and found that Nigeria made no significant progress in addressing deficiencies identified in its fiscal transparency practices.
According to the assessment, Nigeria had made its enacted budget and end-of-year report accessible to the public, including online, but failed to publish its executive budget proposal within a reasonable period.
The US government also identified gaps in the completeness of Nigeria’s budget information, noting that budget documents did not provide a substantially complete picture of government revenues and expenditures.
It further found discrepancies between actual revenues and expenditures and the enacted budget, raising concerns about the implementation of approved budgets.
Economists Raise Concerns
Director of the Lagos Business School Public Sector Initiative, Prof. Franklin Ngwu, said the report reflected longstanding concerns over Nigeria’s budget and financial management.
Ngwu questioned the continued rollover of budgets and the uncertainty surrounding the implementation of successive appropriations, noting that portions of the 2025 budget had been carried into 2026.
He warned that continued weaknesses in fiscal management could damage Nigeria’s international reputation and make foreign investors more cautious.
According to him, the Federal Government needs to introduce serious reforms to strengthen fiscal management and restore confidence in the country’s economic governance.
Professor of Economics and Public Policy at the University of Uyo, Prof. Akpan Ekpo, described the US assessment as fair, arguing that Nigeria’s fiscal challenges were already evident within the country.
Ekpo called for greater transparency in government borrowing, procurement, revenue and expenditure, while urging stronger scrutiny of the budget process.
He also warned that running multiple budgets concurrently could weaken investor confidence and undermine the effectiveness of the budget as a tool of macroeconomic management.
The Chief Executive Officer of Economic Associates, Dr Ayo Teriba, also criticised the government’s approach to budget reporting, saying successive budgets were announced without adequate publication of performance reports showing how appropriated funds were actually spent.
He advocated the publication of year-to-date budget performance reports before new budget proposals are presented, saying such disclosure would enable citizens and investors to assess the performance of previous appropriations.
However, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, said the Federal Government deserved credit for making detailed budget documents available to the public.
While acknowledging that implementation remained a major weakness, Yusuf said Nigeria’s budget was among the more detailed government documents available in the public space and agreed that further reforms were necessary.
US Flags Procurement, Audit Gaps
The US report also raised concerns about Nigeria’s public procurement system, stating that the country failed to make information on public procurement contracts accessible to the public.
On auditing, the Department of State said Nigeria’s supreme audit institution did not meet international standards of independence and did not publish substantive reports, despite having access to the entire executed budget.
The assessment, however, acknowledged some areas of progress. It noted that Nigeria had made information on debt obligations, including major state-owned enterprise debt, publicly available.
The report also credited Nigeria with maintaining a legal framework governing its sovereign wealth fund and with having laws specifying criteria and procedures for awarding natural resource extraction contracts and licences.
US Recommendations
The US Department of State recommended several measures to help Nigeria improve its fiscal transparency.
It urged the government to make its executive budget proposal easily accessible to the public, including online, and to provide a substantially complete picture of government revenues and expenditures.
The US also called for actual revenues and expenditures to reasonably correspond with figures contained in enacted budgets.
On auditing, it recommended that Nigeria strengthen the independence of its supreme audit institution in line with international standards and publish audit reports on government expenditure.
The department further called for accessible information on public procurement contracts to be made available to Nigerians.
The United States stressed that fiscal transparency was important for effective public financial management, market confidence and economic sustainability.
It also clarified that failing to meet minimum fiscal transparency requirements should not automatically be interpreted as a finding of significant corruption, noting that the assessment was not a corruption rating.
73 Countries Passed
The 2026 assessment found that 73 governments met the minimum fiscal transparency requirements, while 67 failed to meet them.
Of the 67 that failed, 14 were judged to have made significant progress towards addressing their deficiencies during the review period.
Countries listed as meeting the requirements included Ghana, Kenya, Rwanda, South Africa, Uganda, India, Indonesia, Morocco and Mauritius.
For Nigeria, the report presents a mixed picture: the country was recognised for making its enacted budget and end-of-year report accessible, publishing debt information and maintaining legal frameworks for sovereign wealth management and natural resource contracts.
However, significant gaps remained in the completeness, reliability and accessibility of public financial information.
The Ministry of Finance, when contacted for comments, said it would respond to the report at a later date.
