In the initial six months of 2023, Lagos State, the economic powerhouse of Nigeria, recorded an impressive Internally Generated Revenue (IGR) of approximately N400 billion, a testament to its robust financial strides. This announcement was made by Mosepefoluwa George, the Commissioner for Economic Planning and Budget, during the 2024 Budget Consultative Forum held in Ikeja.
Expressing optimism about the state’s economic trajectory, George stated, “We’re fortunate because we are going in the right direction, and hopefully, we can continue to build on that to attract the right investments and funding to be able to independently finance our budgets and projects.”
Highlighting the state’s favorable credit rating and burgeoning IGR, the commissioner advocated for a diverse funding approach, including public-private partnerships (PPPs), to bolster economic growth.
George emphasized the significant role of the informal sector, underscoring the state’s determination to tap into its vast potential. He highlighted initiatives like the Lagos State Employment Trust Fund, which supports small and medium enterprises through loans and grants, affirming the pivotal role of SMEs in the state’s economy.
Lagos State, renowned as Nigeria’s commercial epicenter and the largest economy, also holds the distinction of being the fifth-largest economy in Africa. In 2021, the state’s IGR exceeded N500 billion, and its GDP for 2022 surpassed $100 billion.
In the budget performance report for the first quarter of 2023, the state contemplated the introduction of a “State Excise Tax” targeting items like alcohol, tobacco, betting, and gambling to bolster revenue streams. The report urged a focused effort on augmenting tax penetration to enhance revenue.
The Lagos State Internal Revenue Service (LIRS) achieved an 87 percent performance, while IGR registered a 36 percent accomplishment during the period under review. The report recommended that the state explore business opportunities around proposed and ongoing infrastructural projects to stimulate economic growth.
While advocating for prudent fiscal management, the report suggested an emphasis on projects with high social returns to invigorate the economy. It also revealed that as of December 2022, the total external debt stood at $1.25 billion, with the total debt stock to GDP ratio at 4.5 percent. Domestic debt for the same period totaled N807.2 billion, with domestic debt accounting for 69 percent of the total. Furthermore, total revenue constituted 71.2 percent of the total debt stock, reflecting a balanced financial outlook.