The Independent Media and Policy Initiative (IMPI) has announced that the administration of President Bola Ahmed Tinubu has set a historic record by committing $8 billion to capital expenditure in a single fiscal year, the highest since Nigeria's return to democratic rule in 1999.
In a policy statement signed by its Chairman, Dr Omoniyi Akinsiju, the policy think tank emphasized that years of insufficient investment in capital projects have significantly deepened Nigeria's infrastructure deficit. The country would need at least $14 billion in annual spending over the next decade to close this gap, according to the group.
Infrastructure Deficit and Economic Growth
Dr Akinsiju noted that prolonged underinvestment in key sectors such as roads, electricity, rail transport, healthcare, education, and housing has widened Nigeria's infrastructure gap and slowed economic growth. The group stressed that consistent infrastructure investment is essential for boosting productivity, attracting investors, and improving living standards.
Countries pursuing rapid economic growth often commit substantial resources to long-term projects that drive industrialization, create jobs, and strengthen regional connectivity, the statement added.
Historical Underperformance in Capital Budgets
IMPI linked Nigeria's slow infrastructural development to poor implementation of capital budgets and the continued dominance of recurrent expenditure in public spending. Successive administrations failed to sustain adequate capital investment despite periods of strong oil revenue.
According to IMPI, federal capital budgets between 2000 and 2020 mostly ranged between $2 billion and $12 billion, with implementation levels in many years falling below 70 percent. During years of oil windfalls, actual releases for infrastructure projects remained relatively low, worsening the nation's development challenges.
Detailed Historical Data
The think tank provided detailed data: In 2000, projected capital expenditure was $3.62 billion, but only the first quarter was fully disbursed. In 2001, despite high oil revenues, the capital budget was $3.87 billion, again with only first-quarter disbursement. In 2002, the appropriated capital expenditure was $2.7 billion, with only 38% implemented. This declined to $2.25 billion in 2003 and increased marginally to $2.6 billion in 2004.
Capital spending rose to $4.6 billion in 2005, but only 55% was implemented. In 2006, infrastructure spending was $4.5 billion. In 2007, the capital budget ballooned to over $5 billion, but actual spending was about $3.9 billion. In 2008, $6.7 billion was appropriated with low implementation. In 2009, approximately $7 billion was budgeted, but only 54.26% was released.
During the oil boom years of 2010-2013, appropriated capital expenditure increased to $12.3 billion, $10.42 billion, $8.2 billion, and $9.9 billion respectively, but all performed below 70%. After the global oil price decline in 2014, capital expenditure returned to the $6 billion range. By 2015, reduced earnings led to a capital budget of about $3.2 billion, with only $1 billion spent by September.
Improvements Under Buhari and Tinubu
The organization acknowledged improvements in infrastructure funding during former President Muhammadu Buhari's administration, largely driven by increased borrowing for capital projects. In 2016, despite the oil crash, about $3.95 billion was released for capital projects, the highest up to that point, achieved through loans. In 2017, proposed capital expenditure was $7.3 billion, with $4.5 billion released. In 2018, $9.42 billion was budgeted, with $4.4 billion released. In 2019, $6.6 billion was budgeted, with $3.9 billion released. In 2020, budgeted capital expenditure was about $5.0 billion.
The trend accelerated under President Bola Tinubu, whose administration surpassed the long-standing annual infrastructure spending benchmark of about $14 billion for the first time. The 2026 budget significantly increased allocations to infrastructure and capital expenditure, marking a major shift in Nigeria's fiscal direction toward aggressive infrastructure development.
Debt-for-Infrastructure Approach
IMPI argued that the administration's debt-for-infrastructure approach offers a viable pathway for stimulating economic growth, expanding productive capacity, and attracting long-term foreign investment. The group noted that this strategy has enabled the government to commit unprecedented resources to capital projects, setting a new standard for fiscal responsibility and development.
