Nigeria’s economic growth is at the risk of headwinds from elevated borrowing costs and persistently high inflation despite stronger oil production, improved macroeconomic stability and ongoing economic reforms.

The Organisation of the Petroleum Exporting Countries (OPEC) expressed the view in its July Monthly Oil Market Report.

According to the OPEC Nigeria’s near-term economic outlook remained positive, supported by improved macroeconomic stability, steady oil production, recovering private-sector activity and continued reform momentum.

According to the report, the country’s economy expanded 3.9 percent year-on-year in the first quarter of 2026, only slightly below the 4.0 percent growth recorded in the fourth quarter of 2025, indicating that growth remained close to recent highs.

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The oil cartel, however, warned that rising inflation, high borrowing costs and the need to maintain exchange-rate stability remained significant risks to the country’s economic outlook.

The OPEC stated, “Overall, Nigeria’s near-term outlook remains positive, supported by oil production, reform progress, infrastructure investment and stronger business activity, but high inflation, elevated borrowing costs and the need to preserve exchange-rate stability remain important challenges”.

The report noted that the non-oil sector continued to drive economic expansion, with agriculture, manufacturing, construction, trade, finance and insurance providing the main support for growth.

“The non-oil economy continues to provide the main support, with activity driven by agriculture, manufacturing, construction, trade, and finance and insurance, while higher oil output has improved fiscal revenues, foreign-exchange inflows and external buffers. Survey indicators also point to continued near-term momentum,” the organisation noted, adding that increased oil production had strengthened government revenues, foreign exchange inflows and external reserves.

The OPEC also cited business survey data showing sustained private-sector expansion, noting that the Stanbic IBTC Bank Nigeria Purchasing Managers’ Index eased marginally to 53.4 in June from 54.1 in May but remained above the 50-point threshold that signals expansion.

According to the report, the improvement was driven by higher output, stronger new orders and resilient customer demand, although manufacturing activity softened slightly during the period.

The organisation also said increased domestic refining capacity, including improved fuel supply from the Dangote Refinery, should continue to enhance energy availability and reduce import-related pressures on the economy.

It stated, “At the same time, manufacturing activity was slightly softer. Higher domestic refining capacity, including improved fuel supply from the Dangote Refinery, should continue to support energy availability and reduce some import-related pressures.”

On inflation, the OPEC noted that consumer prices continued to rise, with the inflation rate increasing to 15.9 percent year-on-year in May from 15.7 percent in April, as food prices continued to erode household purchasing power.

It said the inflationary trend meant monetary policy was likely to remain cautious despite improved exchange-rate stability and stronger oil-related inflows.

“Inflation rose further to 15.9 percent y-o-y in May, up from 15.7 percent, y-o-y in April, with food prices still putting pressure on household purchasing power. This means that monetary policy is likely to remain cautious, despite improved exchange-rate stability and stronger oil-related inflows,” the report noted.

The House of Representatives Public Accounts Committee has stepped up investigation into revenue remittances by federal agencies into the Federation Account.

Consequently, the house directed the Office of the Accountant-General of the Federation to submit a detailed account of outstanding operating surplus and other revenues allegedly owed to the Federal Government by the Central Bank of Nigeria (CBN), the Nigerian National Petroleum Company Limited (NNPC Ltd), and other government-owned enterprises.

The committee also demanded explanations over allegations that the Office of the Accountant General of the Federation (OAGF) deducted funds from the statutory accounts of several Ministries, Departments and Agencies, including the reported withdrawal of N15bn from the Universal Basic Education Commission (UBEC), raising concerns that the practice may have hampered the agencies’ ability to carry out their statutory mandates.

The directives were issued during an investigative hearing at the National Assembly, where the Accountant-General of the Federation (AFG), Shamseldeen Ogunjimi, appeared alongside senior officials of the Treasury.

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The hearing forms part of the committee’s broader oversight of public finances and compliance with the Fiscal Responsibility Act, which requires government-owned enterprises to remit a prescribed percentage of their operating surplus to the Consolidated Revenue Fund.

The operating surplus regime is intended to strengthen government revenues and curb leakages, but compliance has remained a recurring concern, with several agencies accused over the years of either under-remitting or failing to remit altogether.

Opening the discussion, a member of the committee, Gboyega Isiaka, expressed concern over Nigeria’s weak revenue performance, arguing that poor remittance compliance continued to undermine the country’s fiscal position.

Addressing the nation’s top accountant, the lawmaker said, “Considering our GDP, ours is one of the lowest on the continent, at about 16 percent. Business entities are expected to return about 80 percent of their operating surplus, while others remit between 20 and 50 percent.

“From everything we are seeing, there still appears to be a backlog of remittances. Can you provide some figures? Beyond that, as a member of the economic management team, how satisfied are you with the performance of agencies such as the CBN, SEC, NIMASA, and others, considering the scale of assets they manage?

“It is not enough to say they remitted 80 percent of their surpluses. What exactly is the surplus they are declaring? We need to examine that against the assets under their control, as well as the revenues they ought to have paid but have not.”

Responding, the Director of Revenue and Investment at the OAGF, Makinde Mogaji, disclosed that the CBN allegedly owed the Federal Government N5.3tn in unremitted operating surplus.

He said previous efforts by the Public Accounts Committee to recover the funds had not yielded results. “Early last year, the CBN was owing the Federal Government N5.3tn as operating surplus. Despite the efforts of the Public Accounts Committee to recover the money, it has not been paid.

“Seventy percent of that amount ought to have been remitted, but the CBN refused to pay. That is just one of our major sources of revenue. In contrast, an agency like FAAN has remitted N473bn,” he said.

The hearing also examined the OAGF’s policy of automatic deductions from the accounts of MDAs, a mechanism introduced to recover anticipated operating surplus before the end of the fiscal year.

Defending the policy, Ogunjimi said it had significantly improved government revenue collections. “That was an ingenious way of taking, in advance, what was due to the government, and it helped us generate substantial revenue last year,” he said.

He, however, acknowledged that the policy attracted resistance from some agencies, leading to reviews and reversals in certain cases.

“When we introduced the initiative and generated significant revenue, some agencies sought reversals. Some went to the President, arguing that the deductions were excessive. In some cases, the deductions were cancelled entirely; in others, they were reduced.

“We have continued to manage those issues, which is one reason we have not been able to sustain the level of collections achieved last year. There were also instances where agencies such as the NNPC refused to cooperate to the extent that they had to be asked to leave because of their non-compliance. While NNPCL accepted some of the liabilities, it disputed others, and those issues are still being considered by a post-mortem committee.”

Providing further clarification, Mogaji said the auto-deduction framework remained operational and was designed to reconcile agencies’ actual operating surplus after their accounts had been finalised.

“Yes, the auto-deduction system introduced last year is still in operation. It is designed to recover operating surplus in advance, after which agencies compute their actual surplus to determine whether they have been over-deducted or owe additional remittances. The figures we currently have are still subject to reconciliation and should not be regarded as final,” he explained.

The committee, however, questioned the legality and implications of deductions from the accounts of agencies established to deliver essential public services.

The Chairman of the Committee, Bamidele Salam, cited petitions from UBEC and several other agencies alleging that statutory funds had been withdrawn without prompt reimbursement.

“There is an ongoing investigation involving UBEC and other agencies. UBEC claimed that funds approved under its November 2025 Authority to Incur Expenditure were not released by the Accountant-General. It also alleged that N16bn and another N15bn were taken from the commission’s account without refund.

“We are concerned about these deductions from statutory allocations to critical government institutions. It is not only UBEC. NASENI raised similar complaints involving over N70bn, and several other agencies have also made similar allegations. So, what is the justification?” he asked.

Responding, Ogunjimi maintained that the withdrawals were temporary and undertaken only to meet urgent government financing needs, with the understanding that the funds would be refunded when required.

“There have been occasions when the government needed to meet critical financial obligations, and we temporarily utilised funds belonging to some agencies. It is essentially a loan, and we have been refunding those agencies.

“The Accountant-General cannot arbitrarily withdraw money from agencies’ accounts. We first analyse how long the funds have remained idle, acting on directives from the Honourable Minister. If funds have remained unutilised for several months and the government urgently requires financing, we temporarily deploy them and refund the money when the agency needs it.

“For example, we utilised over N300bn belonging to TETFund and subsequently refunded the entire amount. Whenever an agency requests its funds for approved projects, we process the refund,” he added.

Salam, however, rejected the explanation, insisting that statutory agencies should not be deprived of funds appropriated by law for their programmes.

“Which agencies have actually been refunded? UBEC is complaining, NASENI is complaining, NBC is complaining, and several others currently under investigation have made similar claims. Their major grievance is that funds are withdrawn from their accounts, leaving them unable to carry out the responsibilities for which the money was appropriated.

“Take UBEC, for instance. We all know the consequences of neglecting basic education, particularly in northern Nigeria. We have about 13.5 million out-of-school children.”

According to Salam, “UBEC is expected to build schools, provide infrastructure, and supply instructional materials. It cannot effectively discharge those responsibilities if its statutory funds are diverted to other purposes.”

The committee subsequently directed the OAGF to submit detailed records of outstanding operating surplus owed by the CBN, NNPCL and other government-owned enterprises, as well as documentation showing deductions made from MDA accounts, refunds already effected and outstanding balances.

The investigation is expected to continue in the coming weeks as lawmakers seek to determine the extent of compliance with the Fiscal Responsibility Act, recover outstanding revenues due to the Federal Government, and establish whether the deductions from statutory agency accounts were carried out within the ambit of the law.

The Nigerian Content Development and Monitoring Board (NCDMB) has commenced a 10-day training programme in Scaffolding and Rigging Skills for 50 youths in Port Harcourt, Rivers State, in collaboration with Mimshack Swift Limited.

The training, which began on July 13, will run through July 24th, 2026, and is designed to equip young Nigerians with industry-relevant technical skills for safe and effective operations in the oil and gas, construction, and maritime sectors.

Participants will receive both theoretical and practical instruction in scaffolding erection and dismantling, rigging techniques, load calculation, the use of lifting equipment, hazard identification, and workplace safety standards. The programme is structured to produce certified technicians who can meet industry requirements and global best practices.

The management of Mimshack Swift Limited commended NCDMB for the partnership and urged the 50 beneficiaries to take the training seriously. They emphasised that the skills acquired will open doors to employment and entrepreneurship opportunities in high-demand technical fields.

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Beneficiaries expressed gratitude to NCDMB and Mimshack Swift Limited for the opportunity, stating that the training will enable them to become self-reliant and contribute to safer project execution in the industry.