The special adviser to the president on economic affairs (Office of the Vice President), Tope Fasua, has said that the weakening of the naira has reduced the number of Nigerians migrating from the country.
He said this on Thursday during a panel discussion at the 2025 Annual Outlook Conference, which was organised by Meristem in Lagos.
Segments of the currency market had been harmonised in June 2023 which led to the floating of the naira and saw the local currency depreciating sharply.
As of September, Bloomberg said that the naira had lost about 70 per cent of its value since the harmonisation. Also, ‘Japa’ is a Yoruba term, which means to run away. It has become a buzzword to represent the mass migration of Nigerians to other countries.
Speaking during the panel discussion, Fasua, who is also an economist, highlighted some of the effects of the naira devaluation and the 2025 budget.
He said, “There are a couple of advantages because the naira volume has moved up from about N30tn, N31tn to N49tn; what we’re trying to see is how to milk the PPP advantage. That’s the purchasing power parity. Whereas in dollar terms, it’s not particularly a significant budget and also per capita. But what we can do is focus on the Nigerian economy and the domestic economy and see what naira can buy. So, when we talk about PPP, essentially, you’re saying that $10 in New York, for example, probably can’t even buy your lunch. However, $10 translates to about N16,000 in Nigeria. So, we intend to see how we can focus on the local economy.
“The devaluation, or rather, the depreciation of the naira that we’ve seen since our government came, is double-edged, actually, in terms of its impact. On one hand, it has impacted inflation, but on the flip side, it has reduced the ‘Japa’ rate, because if before you would have been able to get to the UK with maybe N2m or N1.5m for your ticket, now you have to look for maybe N4m or N5m, an economy seat, meaning that people are thinking less of ‘Oh, how do I get out of this country?’”
Fasua added that some of the sectors in the economy are doing well and said he was on the side of an even larger budget, which he believes can be funded.
He said, “We are focusing more on the local economy. So, you asked about the GDP side; regarding the budget, I am one proponent of an even larger budget because you have a lot to take care of. When I say that Nigeria’s budget per capita is one of the smallest in the world. I mean it. When I was running for president in 2019, I did some research, and I found out that we were only better than DR Congo, and only half of DR Congo is under the government’s control; parts of Congo are still under rebel control. Therefore, the government doesn’t budget for that area. So, we don’t want to be in such a category.
“I’m saying that the $150-$120 per person, which is what is budgeted for your health, for your agriculture, for your roads, for your education, and for everything else, is small. When you go to Europe, you see budgets of $20,000 per person. When you go to the US, you see $20,000 – $25,000 per person. We want to be able to get to that level but gradually. South Africa is $2,000 per person. Angola, $1,200 per person. Like Algeria, about $700 per person. That’s the kind of thing we want to aspire to in a very short period of time. So, we haven’t actually started in that area, but it’s one of the pushes we’re making in government. Maybe next year we’re going to be talking about an N80-something trillion budget, and we can fund it.”
A few weeks to the end of 2024, President Bola Tinubu presented a proposed N49.7tn budget for 2025 to the National Assembly.
Themed ‘Budget of Restoration: Securing Peace, Rebuilding Prosperity,’ it was centred on three strategic priorities: security, infrastructure development, and human capital investment.
The Federal Government projects a total revenue of N36.35tn for 2025, anchored on improved non-oil revenue generation.
“This includes expanded tax collections, customs duties, and independent revenue from government-owned enterprises, alongside oil revenue projections based on a crude oil benchmark of $75 per barrel, a production target of 2.06 million barrels per day, and an exchange rate of N1,500 per USD,” said the Director-General, Budget Office of the Federation, Tanimu Yakubu, after the budget presentation.
He continued, “The total expenditure of N49.7tn includes significant allocations to critical sectors while targeting a fiscal deficit of N13.39tn (3.96 per cent of GDP). This deficit will be financed through domestic and external borrowings as well as innovative public-private partnership (PPP) arrangements.”
