Business
Nigeria’s Debt, Salaries Exceed Revenue Amid Capital Cuts
Nigeria’s 2025 budget shows debt and personnel costs surpass revenue, forcing major cuts to capital projects and highlighting fiscal vulnerability
Debt service and personnel costs have exceeded the Federal Government’s total revenue for the first seven months of 2025, the Budget Office of the Federation revealed on Wednesday, underscoring the strain on the nation’s finances.
Also read: Four Lawmakers Defect to APC Amid Party Crisis
The 2026–2028 Medium-Term Expenditure Framework and Fiscal Strategy Paper showed that between January and July, the government earned N13.67tn against a pro rata target of N23.85tn, leaving a shortfall of N10.19tn, or roughly 43 per cent.
The shortfall was largely due to a sharp drop in oil receipts, which fell 62.2 per cent below target, while dividends from state-linked entities also underperformed.
Despite modest gains from company income tax and Value Added Tax, the fiscal gap forced the government to overspend on debt service, which rose to N9.81tn, consuming 71.8 per cent of total revenue.
Combined with personnel costs of N4.51tn, recurrent spending alone accounted for roughly 105 per cent of revenue, leaving little room for capital investments.
Capital expenditure bore the brunt of the squeeze. Aggregate spending on projects from January to July was N3.60tn, only 26.3 per cent of the prorated N13.67tn budget.
Ministries, departments, and agencies received less than 10 per cent of their planned allocations, while donor-funded and project-tied loans fared relatively better.
The Budget Office linked the weak capital performance partly to the extended implementation of the 2024 budget, which is still financing ongoing projects.
The government has now directed that 70 per cent of the 2025 capital budget be carried over into 2026 to prioritise the completion of existing projects and manage spending pressures amid weak revenue inflows.
Economists expressed mixed views. Professor Sheriffdeen Tella of Olabisi Onabanjo University criticised the preparation of the 2026 budget when the 2025 budget had barely begun implementation, calling it premature.
Conversely, Dr Muda Yusuf of the Centre for the Promotion of Private Enterprise supported the rollover, saying it restores credibility and prevents continuous overlapping of budgets.
The MTEF document also revealed that non-debt recurrent expenditure fell 26 per cent below target, pensions were underfunded by half, and overheads for ministries were sharply reduced, while debt service overshot projections by 17.5 per cent.
The analysis highlights Nigeria’s fiscal vulnerability, particularly the economy’s reliance on oil revenue, even as non-oil revenues gradually increase their contribution to the Federation Account.
Also read: Four Lawmakers Defect to APC Amid Party Crisis
The report warns that without structural fiscal reforms, capital projects critical to health, education, infrastructure, and social safety nets will continue to face deep constraints.
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Business
Kola Karim’s Shoreline Group Signs $300 million Deal With Accor to Develop Nigeria’s First National Hotel Platform
Kola Karim’s Shoreline Group has signed a letter of intent with Accor, a world leading hospitality group to establish Nigeria’s first national hotel platform.
The signing took place during the Africa Forward Summit 2026 hosted jointly by Kenya and France in Nairobi.
This ambitious partnership is set to make a significant contribution to the evolving Nigerian hospitality landscape with a substantial investment from Shoreline of $300 million, leveraging Accor’s renowned brand portfolio and expertise.
As gathered the strategic collaboration aims to develop a hotel network across Nigeria, encompassing 10 hotels across eight cities and over 1,200 rooms by 2030.
These properties will span various segments, from midscale to luxury, catering to diverse travelers and contributing significantly to the nation’s tourism growth. The project also includes the establishment of a dedicated hospitality training Academy to nurture local talent and create approximately 1,000 direct jobs.
Mr. Sébastien Bazin, Chairman and CEO of Accor, stated: “We are thrilled to partner with Shoreline Group to unlock the immense potential of Nigeria’s hospitality sector. This partnership is a testament to our belief in Nigeria’s dynamic future.
“By combining Shoreline’s deep understanding of the local market with Accor’s global expertise and diverse brand portfolio, we are poised to create an unparalleled hospitality offering that will set new benchmarks for quality and service.
“Crucially, the establishment of the Accor Academy is integral to this vision, enabling us to deliver immediate talent development for the Shoreline hotel portfolio, demonstrate our long-term commitment to Nigeria through dedicated training facilities, and solidify Accor’s position as the employer and educator of choice in West Africa.”
The Agbaoye of Ibadanland and Chairman of Shoreline Group, Karim, commenting on the development said: “This partnership is central to Shoreline’s strategy of building institutional-quality infrastructure platforms across Africa.
“We anticipate hospitality infrastructure becoming increasingly vital for capital movement and development, particularly in Nigeria where high-quality room supply is underserved. Our choice to partner with Accor highlights our focus on operational excellence and long-term value.
“The hospitality academy is crucial, alongside physical hotels, for developing local talent to sustain international standards. It will support our portfolio and enhance Nigeria’s hospitality workforce.
“This investment aligns with Shoreline’s broader focus on strategic assets in energy, infrastructure, and industrial development. We view hospitality as a natural extension: real infrastructure supporting economic activity, local capability, and national growth.”
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