Atiku Bagudu, minister of budget and economic planning, says the Central Bank of Nigeria (CBN) will not exceed the 5 percent limit on ways and means financing to the federal government.

Bagudu,who spoke on the 2025 budget in collaboration with KPMG on Arise Television ,said stressed that the government will not rely on the CBN to finance its N14 trillion deficit but will explore innovative financing approaches.

ways and means is a loan facility through which the CBN finances the federal government’s budget shortfalls.

Minister said the CBN’s guidelines already limit the amount available to the government under its ways and means facilities to 5 percent in the 2024-2025 fiscal year.
This, Bagudu said, will boost investor confidence in Nigeria’s ability to manage its debt.

“Under no circumstance will the Central Bank be going above the legal limit of 5 per cent, I think that should comport the economy that we are not going to have recourse to,” he said.

“Because we are also going to market in different ways, innovative financing or approaches, the local bonds have been issued, where governments have raised money.

“This represents a statement of intention, just to ensure that those whom we have borrowed from will be confident that we will have enough to meet our debt service obligation.

“If as we anticipate, economic conditions will continue to improve, maybe we may not need to spend after that in debt service.”

On his part, Wale Edun, minister of finance and coordinating minister of the economy, said the federal government prioritises macroeconomic stability, leveraging exchange rate stability, trade surplus, and increased oil production to strengthen Nigeria’s global position.

He added that the country’s foreign reserves have now surpassed $40 billion, reflecting confidence in its economic policies, as the government aims for 7 percent annual growth.

In September 2024, Edun, said the federal government had “exited” servicing its debts through ways and means, a factor analysts often partly blame for high inflation.

In his Independence Day speech last year, President Bola Tinubu said the federal government has cleared over N30 trillion in ways and means advances.

The Nigerian National Petroleum Company (NNPC) Limited says negotiation is ongoing for a new naira-for-crude deal with Dangote Petroleum Refinery.

NNPC announced in a statement on Monday after TheCable reported earlier that the government-owned oil company had reportedly suspended the naira-for-crude deal until 2030, as it has forward-sold all its crude oil.

The discontinuation will force refiners to rely on international suppliers for crude oil, gulping huge costs in dollars and triggering an uptick in the pump price of petrol.

However, Olufemi Soneye, the chief corporate communications officer of NNPC, said the current deal will expire at the end of March.

“NNPC Limited has noted recent reports circulating on social media regarding the alleged unilateral termination of the crude oil sales agreement in Naira between NNPC and Dangote Refinery,” Soneye said.

“To clarify, the contract for the sale of crude oil in Naira was structured as a six-month agreement, subject to availability, and expires at the end of March 2025. Discussions are currently ongoing towards emplacing a new contract.”

Under the current arrangement, Soneye said NNPC has made over 48 million barrels of crude oil available to Dangote refinery since October 2024.

“In aggregate, NNPC has made over 84 million barrels of crude oil available to the Refinery since its commencement of operations in 2023,” he said.

“NNPC Limited remains committed to supplying crude oil for local refining based on mutually agreed terms and conditions.”

The sale of crude oil and refined petroleum products in naira to local refineries commenced on October 1, 2024, to improve supply, save the country millions of dollars in petroleum products imports, and ultimately reduce pump prices.