Month: October 2025

The Katsina State Government has announced an ambitious plan to increase its Internally Generated Revenue (IGR) to N140 billion annually by 2026, marking a major step toward financial sustainability and reduced dependence on federal allocations. The strategy, anchored on digital innovation, data integration, and community-driven participation, is expected to transform the state’s fiscal landscape and accelerate socio-economic development.

This was revealed by the Commissioner for Budget and Economic Planning, Alhaji Malik Anas, during the launch of the State of States 2025 Report by BudgIT in Abuja. His announcement was later reinforced through an official statement issued by Mr. Shuaibu Sada, spokesperson for the Katsina State Internal Revenue Service (KT-IRS), on Thursday.

From N10 Billion to N140 Billion: The Road to Fiscal Transformation

According to Anas, Katsina’s IGR has seen steady growth in recent years, increasing from N10 billion in 2021 to N24 billion in 2024. However, he noted that despite this progress, the figure remains far below the state’s actual revenue potential.

“Our administration is working to modernize the entire tax ecosystem,” he explained. “We are adopting a community-based revenue collection model that directly ties tax payments to visible development outcomes. When citizens see their taxes being used to fund projects in their communities, compliance improves naturally.”

The commissioner also disclosed that the government had launched an e-invoicing and e-payment system to facilitate real-time tax assessment, collection, and reconciliation, a move designed to minimize leakages and curb corruption in revenue administration.

Anas further noted that the state is in the process of establishing a comprehensive enterprise data warehouse, which will capture detailed information on small and medium-sized enterprises (SMEs) operating across the state. The database will help the government identify new taxpayers, forecast revenue trends more accurately, and broaden the tax net.

“With the full rollout of our digital tax infrastructure and business data systems, we project to reach N140 billion in annual IGR by 2026,” Anas stated confidently.

Data-Driven Governance and Community Integration

The Katsina State Government’s revenue strategy goes beyond taxation—it is rooted in data-driven planning and citizen engagement. By linking revenue collection to local development outcomes, the state hopes to rebuild trust between government and citizens, ensuring that taxpayers perceive tangible value from their contributions.

Anas emphasized that this inclusive approach ensures that residents in urban and rural areas alike understand the direct benefits of compliance. “We now prioritize community ownership of development projects,” he said. “Funds generated through taxes are visibly channeled into schools, healthcare centers, roads, and security initiatives.”

National Context: How Katsina Compares

According to the National Bureau of Statistics (NBS), Nigeria’s 36 states and the Federal Capital Territory (FCT) collectively generated N3.63 trillion in IGR in 2024, bringing total revenue generated between 2021 and 2024 to N10.88 trillion.

Despite these figures, most states remain heavily dependent on federal allocations through the Federation Account Allocation Committee (FAAC). Between January and July 2025, FAAC disbursed a total of N4.43 trillion to the states, with oil-producing states such as Delta (N361.23 billion), Rivers (N301.18 billion), Lagos (N279.03 billion), Akwa Ibom (N278.11 billion), and Bayelsa (N274.81 billion) receiving the highest allocations.

Katsina, a non-oil-producing state, has therefore recognized the urgent need to diversify its revenue base and boost self-sufficiency. The state’s current IGR represents a fraction of its potential, given its population size, agricultural base, and growing informal sector.

Recent Development Initiatives

The government’s broader development agenda complements its revenue reforms. In July 2025, the Katsina State Government approved N23.8 billion for key infrastructure and social projects. The funds are being channeled into healthcare upgrades, road rehabilitation, security improvements, and hospitality sector revitalization.

The projects are concentrated in five major Local Government Areas (LGAs)—Kankara, Malumfashi, Faskari, Jibia, and Funtua—which are seen as strategic economic hubs within the state.

Looking Ahead

The Katsina State Government’s vision aligns with its goal of achieving 70% broadband penetration by 2030, an initiative expected to accelerate digital transformation across sectors, including tax administration, education, and governance.

Analysts say the N140 billion IGR target is ambitious but achievable if the government sustains momentum in digitalization, improves enforcement, and deepens public awareness.

By embracing technology-driven governance, data intelligence, and inclusive fiscal management, Katsina aims not only to improve its revenue profile but also to set a benchmark for other northern states striving for economic independence.

If successful, the initiative could position Katsina as one of Nigeria’s top-performing subnational economies by 2026, signaling a shift toward innovation-led fiscal sustainability in state governance.

President Bola Tinubu has approved the implementation of a 15% ad-valorem import duty on premium motor spirit (PMS), popularly known as petrol, and automotive gas oil (AGO), also known as diesel. The move aims to align import costs with prevailing domestic market conditions but is expected to raise fuel pump prices across the country.

Presidential Approval and Implementation

The approval was conveyed in a letter dated October 21, 2025, issued by Damilotun Aderemi, the President’s Private Secretary, to the Federal Inland Revenue Service (FIRS) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).

According to the letter, the FIRS had requested the President’s authorization to apply a 15% import duty based on the Cost, Insurance, and Freight (CIF) value of imported petroleum products. The measure, according to the agency, is intended to ensure fair pricing, reduce fiscal leakages, and promote competitiveness in the downstream sector.

With this directive, analysts estimate that the new duty could push petrol prices higher by approximately ₦99.72 per litre, depending on global crude prices and exchange rate fluctuations.

NNPCL to Review Refinery Operations

Following the announcement, the Nigerian National Petroleum Company Limited (NNPCL) confirmed that it has initiated a comprehensive review of the country’s three state-owned refineries as part of efforts to reduce reliance on imports.

In a post on X (formerly Twitter), Bayo Ojulari, the Group Chief Executive Officer of NNPCL, said the company is exploring multiple strategies to restore refinery operations. These include partnerships with technical equity investors to either upgrade or repurpose the facilities.

“The NNPCL remains optimistic that the refineries will operate efficiently despite current setbacks,” Ojulari stated in an update titled “Update on Our Refineries.”

Despite over $3 billion spent on turnaround maintenance in recent years, Nigeria’s refineries — in Port Harcourt, Warri, and Kaduna — have largely remained non-operational. The 60,000-barrel-per-day section of the Port Harcourt refinery briefly resumed operations before shutting down again, while the Warri refinery remains mostly idle. The Kaduna refinery has yet to restart production.

Rising Fuel Import Costs

Nigeria’s dependence on imported fuel continues to strain foreign reserves and pressure the naira. According to National Bureau of Statistics (NBS) data, the country spent ₦4 trillion on fuel imports in the first half of 2025 alone.

• Q1 2025: ₦1.76 trillion in fuel imports

• Q2 2025: ₦2.3 trillion in fuel imports

• Total (H1 2025): ₦4 trillion

For comparison, total fuel import expenditure for the entire year of 2024 stood at ₦15.4 trillion, highlighting the scale of Nigeria’s import dependence despite multiple refinery rehabilitation projects.

The NBS report also revealed that Nigeria imported ₦208.76 billion worth of petrol from ECOWAS countries in Q2 2025, underscoring the continued importance of regional supply chains in meeting domestic demand.

Outlook

The introduction of the new 15% import duty marks a significant shift in Nigeria’s fuel pricing policy, likely resulting in higher pump prices for consumers in the short term. However, government officials argue that the measure is necessary to align import economics, boost fiscal revenues, and encourage local refining capacity — particularly as the Dangote Refinery and other modular refineries ramp up production.

As Nigeria works toward achieving self-sufficiency in refined products, the effectiveness of this policy will depend on how quickly domestic refineries can come online and offset the impact of rising import costs on consumers.

Unilever Nigeria Plc has posted impressive financial results for the third quarter (Q3) of 2025, achieving strong double-digit growth across key performance metrics. The company’s unaudited interim financial statement for the nine-month period ending September 30, 2025, showed that revenue rose by 50% year-on-year, while profit after tax doubled compared to the same period in 2024.

Strong Revenue and Profit Growth

The consumer goods giant reported a turnover of ₦155 billion, a sharp increase from ₦104 billion recorded in Q3 2024. This growth was attributed to a stronger product portfolio, effective pricing strategies, and increased consumer demand across key categories.

Unilever’s gross profit also climbed 49% to ₦64 billion, reflecting effective cost discipline and operational efficiency. The company’s net profit surged to ₦22 billion, up from ₦11 billion in the corresponding period last year — effectively doubling its bottom line within a year.

Management Commentary

Commenting on the results, Tobi Adeniyi, Managing Director of Unilever Nigeria, said the company’s strong Q3 performance highlights its strategic focus on profitability and brand growth.

“Our Q3 performance reflects the strength of our focus on our power brands, strategic product mix optimization, and disciplined cost management,” Adeniyi stated. “We remain committed to sustaining brand investments, ensuring supply chain resilience, and driving volume-led growth with our robust portfolio.”

He further emphasized Unilever Nigeria’s long-standing contribution to the country’s industrial landscape:

“As a cornerstone of Nigerian manufacturing for over 100 years, we continue to invest locally, expand operations, and build equitable partnerships across our value chain. Our goal remains to brighten everyday life for Nigerians while creating long-term value for our stakeholders.”

Key Performance Highlights

• Revenue: ₦155 billion, up 50% year-on-year

• Gross Profit: ₦64 billion, up 49%

• Net Profit: ₦22 billion, up 100%

• Period Covered: Nine months ended September 30, 2025

Sustained Growth Amid Economic Pressures

Unilever Nigeria’s strong financial showing comes despite a challenging business environment marked by inflation, currency volatility, and rising input costs. The company credited its performance to strategic cost management, localized sourcing, and innovation within its key product categories — including home care, personal care, and food brands.

The results reaffirm Unilever Nigeria’s resilience and adaptability within Nigeria’s fast-moving consumer goods (FMCG) sector. With a diversified brand portfolio and ongoing investments in sustainability and innovation, the company appears well-positioned for continued growth in the final quarter of 2025 and beyond.

African airlines have emerged as the global leaders in air cargo growth, recording a 14.7% year-on-year increase in demand for September 2025 — the strongest performance across all regions, according to the International Air Transport Association (IATA).

African Airlines Drive Global Cargo Momentum

The IATA report highlighted that capacity for African carriers rose 7.4% in the same period, reflecting the continent’s growing significance in global trade logistics. A major contributor to this growth was the Africa–Asia trade corridor, which expanded by 9.6% year-on-year, marking the third consecutive month of positive performance.

This steady rise demonstrates Africa’s strengthening position in global commerce, particularly through partnerships with Asian economies that have boosted cargo volumes and sustained demand.

Global Air Cargo Trends Show Continued Recovery

Globally, air cargo demand increased by 2.9% in September 2025 compared to the same month last year — the seventh straight month of growth. IATA noted that total capacity (measured in available cargo tonne-kilometers, ACTK) also climbed 3.0% year-on-year, signaling steady recovery in global logistics despite economic uncertainties.

According to the IATA data:

• Total demand (CTK) grew 2.9% globally (+3.2% for international operations).

• Total capacity (ACTK) increased by 3.0% (+4.4% for international operations).

“African airlines saw the strongest rise of all regions, with a 14.7% increase in demand and a 7.4% rise in capacity,” IATA said.

Factors Influencing Cargo Performance

The report pointed out that global trade conditions are improving, with goods trade rising 7% year-on-year in August 2025. Meanwhile, jet fuel prices rose 5.4% in September due to a tighter diesel market, even though crude oil prices were lower.

Additionally, the global manufacturing PMI improved to 51.3, its second consecutive month above the expansion threshold, while new export orders edged up to 49.6 — still below 50 but showing progress toward recovery.

Regional Performance Overview

While Africa led globally, other regions also saw varying performance levels:

• Asia-Pacific airlines: +6.8% demand, +4.8% capacity.

• European airlines: +2.5% demand, +4.4% capacity.

• Middle Eastern carriers: +0.6% demand, +5.5% capacity.

• North American carriers: -1.2% demand, -1.5% capacity.

• Latin American airlines: -2.2% demand, +3.1% capacity.

These figures reveal a shift in global trade dynamics, as traditional markets like North America and Europe face stagnation, while Africa and Asia continue to drive expansion.

IATA’s View on Global Trade Shifts

Willie Walsh, IATA’s Director General, attributed the strong performance to structural changes in global trade patterns. He explained that recent U.S. tariff policies and the end of de minimis exemptions have reshaped trade flows, prompting growth along intra-Asian, Asian-African, and Asian-European routes.

“Instead of witnessing a contraction in global trade, the air cargo sector is showing its ability to adapt to evolving market conditions and shifting demand flows,” Walsh stated.

Trade Lane Highlights – September 2025

Air freight performance varied across key global corridors:

• Europe–Asia: +12.4% (31st consecutive month of growth)

• Within Asia: +10% (23rd consecutive month of growth)

• Middle East–Asia: +4.6%

• North America–Europe: +2.6%

• Africa–Asia: +9.6% (third consecutive month of growth)

However, not all trade lanes expanded:

• Asia–North America fell 3.5% (fifth straight month of decline)

• Middle East–Europe dropped 4.6%

• Within Europe declined 1.1%

Outlook

The September figures reaffirm Africa’s growing role in global logistics. As intra-African trade and Asia-linked routes continue to flourish, the continent’s carriers are expected to remain central to air cargo growth through 2026 — signaling both resilience and opportunity in the evolving global trade landscape.

Investor demand for Nigeria’s Federal Government bonds remained exceptionally strong in October 2025, with total subscriptions surpassing ₦1 trillion for the second consecutive month, despite a continued decline in yields.

According to data from the Debt Management Office (DMO), the October auction demonstrated the resilience of investor appetite for government securities even in a lower-rate environment, reflecting strong system liquidity and investor preference for safety.

Yields Decline, but Demand Stays Robust

The five-year FGN AUG 2030 bond cleared at 15.83%, down from 16.00% in September, while the seven-year FGN JUN 2032 bond settled at 15.85%, compared to 16.20% a month earlier.

Ordinarily, falling yields tend to reduce investor interest, but in this case, participation remained exceptionally high. The seven-year instrument recorded ₦1.06 trillion in subscriptions, slightly above the ₦1.03 trillion received in September.

Similarly, the five-year note attracted ₦212.66 billion in bids, only a modest dip from ₦231.79 billion in the previous auction. The continued strength of demand underscores investors’ view of government debt as a low-risk, highly liquid investment option.

Allotments Cut Despite Strong Participation

Despite the trillion-naira subscription levels, the DMO reduced the total amount allotted across both tenors. In October, ₦313.77 billion was allotted, representing a 45.6% drop from the ₦576.62 billion issued in September.

The seven-year bond saw the steepest cut. Out of the ₦1.06 trillion subscribed, only ₦225.97 billion was allotted—less than half of the ₦488.83 billion accepted a month earlier. An additional ₦3 billion was sold through the non-competitive window.

Meanwhile, allotments for the five-year note remained stable at ₦87.80 billion, despite slightly weaker demand.

Analysts say this selective reduction highlights the government’s cautious approach to debt management. By trimming allotments during periods of strong demand, the DMO keeps borrowing costs in check while maintaining investor engagement. It also reflects a broader effort to manage Nigeria’s rising debt burden more prudently.

Demand Outstrips Supply Amid Market Optimism

Total bids for both maturities climbed slightly to ₦1.27 trillion in October from ₦1.26 trillion in September. The DMO had increased its offer size from ₦200 billion to ₦260 billion, but even this larger issuance could not satisfy investor demand.

This sustained oversubscription points to strong liquidity in the financial system, with institutional and retail investors seeking stable returns amid limited alternative assets. The results also suggest that, even with lower yields, FGN bonds continue to serve as a safe haven for investors navigating an uncertain economic environment.

Policy Shift and Economic Backdrop

In September 2025, the Central Bank of Nigeria (CBN) cut the Monetary Policy Rate (MPR) from 27.5% to 27%, marking its first rate reduction in five years. The move followed six consecutive months of declining inflation, with headline inflation dropping to 18.02% in September.

While the rate cut was modest, it signaled a potential shift in the CBN’s monetary stance—from aggressive tightening toward cautious easing. This policy change, combined with declining inflation, likely reinforced investor confidence in the fixed-income market.

The lower yields seen at the October auction reflect these dynamics, as investors adjust to a gradually easing rate environment while maintaining strong demand for risk-free government securities.

Outlook: Further Yield Compression Possible

Analysts expect demand for FGN bonds to remain strong in the months ahead, particularly as liquidity levels stay high and the government maintains a disciplined borrowing strategy.

With the DMO keeping supply below market appetite, yields are likely to face further downward pressure. Unless economic conditions shift dramatically or inflation resurges, investors may continue to accept thinner margins in exchange for the safety and predictability of sovereign debt.

Bottom Line

The October 2025 FGN bond auction confirms that investor confidence in Nigeria’s government debt remains robust despite falling returns.
High demand, even at lower yields, suggests that sovereign instruments remain the preferred choice for investors seeking stability in a still-uncertain macroeconomic climate.