State governments across Nigeria have unveiled ambitious plans to address the nation’s infrastructure deficit, earmarking a combined N28.85 trillion for capital projects over two years. In 2025 alone, governors have proposed N17.51 trillion for infrastructure development, a significant increase from the N11.34 trillion budgeted in 2024. However, funding constraints and implementation challenges remain major hurdles.
Despite a 49.24% increase in federal allocations to states in 2024, rising to N15.12 trillion from N10.14 trillion in 2023, many states struggled to meet their infrastructure targets. Last year, states recorded a deficit of N3.98 trillion, delaying critical projects in sectors such as roads, healthcare, and education.
2024 Budget Implementation: Mixed Results
An analysis of the 2024 budget implementation reports for 32 states and the approved 2025 budgets for 35 states reveals varying levels of success. Nine states, including Delta, Ekiti, Edo, Lagos, Rivers, Yobe, Osun, Bauchi, and Akwa Ibom, achieved over 80% of their capital expenditure targets. Fifteen states implemented between 50% and 76% of their budgets, while eight states scored below 50%.
Lagos State led the pack, spending N1.31 trillion of its N1.53 trillion capital budget, achieving an 85.5% implementation rate. In contrast, Abia State spent only N250.47 billion of its N474.29 billion capital budget, reflecting a 52.8% implementation rate. Akwa Ibom and Adamawa states recorded implementation rates of 84.4% and 75.2%, respectively.
2025 Budget: Ambitious Plans
For 2025, state governments have proposed a 54.39% increase in capital expenditure, totaling N17.51 trillion. Lagos State has the most ambitious plan, allocating N2.07 trillion for infrastructure. Other states with significant allocations include Delta (N630.46 billion), Akwa Ibom (N655 billion), and Abia (N611.67 billion).
However, experts have expressed concerns about the states’ ability to execute these projects, given the persistent funding gaps and rising recurrent expenditures driven by inflation and recent minimum wage increases. Many states rely heavily on federal allocations, with internally generated revenue (IGR) growth remaining subdued due to socioeconomic constraints and inefficiencies in tax collection.
Challenges and Outlook
The report highlights several challenges facing state governments, including low revenue generation, reliance on federal subsidies, and implementation bottlenecks. On average, states only execute about 60% of their budgeted capital expenditures, falling short of the investments needed to meet the growing demands of their populations.
As the year progresses, citizens will be closely monitoring whether states can overcome these challenges and deliver on their infrastructure promises. The success of these plans will be critical to addressing Nigeria’s infrastructure deficit and fostering economic growth.
