U.S. faults Nigeria on fiscal transparency for second straight year

The United States Department of State says Nigeria has failed to meet minimum fiscal transparency standards for a second consecutive year, concluding that the country made “no significant progress” in opening its public ledgers and improving public financial management throughout 2025.

The findings, published in the State Department’s 2026 Fiscal Transparency Report, deliver a sobering assessment of President Bola Tinubu’s administration at a time when Abuja is attempting to restore investor confidence through broad market reforms and foreign capital mobilization.

Out of 140 governments and administrative entities evaluated between January 1 and December 31, 2025, 73 satisfied the U.S. government’s baseline criteria. Among the 67 nations that fell short, 14 were acknowledged for making meaningful strides toward reform. Nigeria, however, was grouped alongside 52 other nations—including Algeria, Angola, and Uganda—classified as having made no measurable headway.

Opaque Ledgers and Budget Execution Gaps

The State Department’s evaluation criticized the structural clarity and execution of Nigeria’s national budget, noting that published documentation offered an incomplete snapshot of federal income and spending.

While federal authorities published the enacted budget and end-of-year financial statements online, officials failed to make the executive budget proposal publicly available within a reasonable timeframe prior to legislative enactment—a key benchmark for enabling public debate.

The report also pointed to significant discrepancies between approved expenditure targets and actual fiscal execution, highlighting that public ledgers lacked detailed breakdowns for executive offices, state-owned enterprises, and off-budget accounts.

“Budget documents did not provide a substantially complete picture of the government’s revenues and expenditures, or break down expenditures to support executive offices in the budget,” the State Department stated in its assessment.

“Actual revenues and expenditures did not reasonably correspond to those in the enacted budget. The government did not publish accessible information on public procurement contracts.”

The findings reflect a noticeable shift from the U.S. government’s previous evaluation, when federal budget disclosures were deemed generally reliable despite lingering operational deficiencies in natural resource licensing and public procurement.

Audit Independence and Procurement Obscurity

A central focus of the U.S. report was the operational independence and public reporting of Nigeria’s supreme audit institution, the Office of the Auditor-General for the Federation.

According to Washington, the auditing body failed to meet international standards of structural independence and did not publish substantive, timely audit reports for public review, despite having access to fully executed budget figures.

Furthermore, public procurement processes across major federal ministries remained largely inaccessible to citizens and independent oversight bodies, obscuring details on public sector contract awards.

Despite the broader critique, the report acknowledged specific areas where Nigeria met standard criteria. Federal authorities maintained publicly accessible records of direct government debt obligations and state-owned enterprise liabilities. The report also commended the Sovereign Wealth Fund—managed by the Nigeria Africa Investment Authority (NSIA)—for operating under a clear legal framework and maintaining transparent funding and withdrawal disclosures.

Abuja Defends Reform Trajectory

In response to the U.S. evaluation, federal officials reiterated that public sector accountability, debt sustainability, and fiscal discipline remain central pillars of the administration’s structural reform agenda.

Responding to the findings, the Presidency emphasized that ongoing digital public finance overhauls and revenue reconciliation exercises are designed to systematically address historical reporting lags.

“Fiscal transparency, accountability, and effective public financial management remain paramount priorities of the federal government,” the Presidency said in an official statement addressing the review.

The U.S. report comes amidst domestic scrutiny over Nigeria’s public accounting practices, where civil society groups and economic analysts have raised concerns over delayed quarterly budget implementation reports and the simultaneous execution of multiple fiscal budget frameworks.