Nigeria's capital expenditure as a percentage of GDP dropped from an average of 4.33% (1981–2001) to just 1.58% (2002–2024)

Key takeaways:

  • From an average of 4.33% in 1981–2001 to just 1.58% in 2002–2024, Nigeria’s capital expenditure as a percentage of GDP has more than halved.
  • The early 2000s marked a major turning point. After peaking at 9.1% in 1999, capital spending nosedived, rarely surpassing 2% in the last two decades.
  • Recent figures show Nigeria’s capital expenditure hovering around 1–2% of GDP.
  • The data suggests a move away from infrastructure investments, potentially prioritising recurrent expenditure such as salaries and overheads.
  • Low capital spending can slow infrastructure development, limiting productivity, economic expansion, and foreign investment attractiveness.
  • If Nigeria is to achieve sustainable growth, there needs to be a renewed focus on capital investments to drive industrialisation, improve public services, and create jobs.

Nigeria’s capital expenditure as a percentage of GDP has seen a significant decline over the past two decades, dropping from an average of 4.33% (1981–2001) to just 1.58% (2002–2024). The data reveals a clear shift in government spending priorities, with capital investments taking a backseat despite the country’s growing infrastructure and development needs.
This drop is even more concerning when compared to historical peaks. Capital spending once hit 9.1% of GDP in 1999, but in recent years, it has struggled to cross 2%. The decline suggests that while Nigeria’s economy has expanded, public investments in critical infrastructure like roads, power, and healthcare have not kept pace. This raises crucial questions about the sustainability of economic growth in the absence of strong public sector investment.

Source:

Central Bank of Nigeria (CBN)

Period:

1981 - 2024
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