Central Bank of Nigeria has disclosed that the Federal Government recorded an estimated fiscal deficit of N485.51 billion in January.
The report by CBN noted that the government’s fiscal deficit for the first month of the year “was 17.1 per cent and 11.5 per cent higher than the target budget deficit and the level in January 2020.
CBN attributed the rise in the fiscal deficit to the rollover and release of outstanding (capital) allocations to the Ministries Departments and Agencies (MDAs) in the 2020 budget, which pushed up aggregate expenditure.
The regulator, however, stated that the disbursement was, “unlikely to constitute liquidity risks, as it had already been accommodated in the financial programme of the government in the 2020 fiscal year.
According to the monthly economic report for January released by the CBN on Friday, the low revenue performance in January was due to the decline in non-oil receipts following the lingering effects of the COVID-19 pandemic on business activities and the resultant shortfall in tax revenues.
“Fiscal operations of the FGN in January 2021 resulted in a tentative overall deficit of N485.51bn.”
The report said that total public debt outstanding of the FGN as of the end-September 2020, stood at N28.03tn, with domestic and external debts accounting for 56.5 per cent and 43.5 per cent, respectively.
According to the report, the continued spread of the COVID–19 pandemic weakened global economic recovery and led to a decline in foreign exchange inflow into the economy in the month under review.
Provisional data showed that aggregate foreign exchange inflow into the economy was $5.47bn, showing decreases of 54.2 per cent and 67.5 per cent below its level in the preceding month and corresponding month of 2020 respectively.
This was attributed to the respective 66.2 per cent and 45.1 per cent decrease in inflow through the CBN and autonomous sources.
Foreign exchange outflow through the economy fell by 22.1 per cent and 57.1 per cent to $2.97bn, from the levels of $3.81bn and $6.92bn respectively in the preceding month and the corresponding month of 2020.
This was driven, largely, by the decline in outflow through the CBN.
Consequently, the foreign exchange transactions through the economy resulted in a net inflow of $2.5bn, compared with $8.1bn and $9.9bn in the preceding month and the corresponding period of 2020 respectively.