Following the release of the states internally generated revenue (IGR) by the Nigerian Bureau of Statistics early in May, we have opened up the numbers to find regional and states insights to better appreciate the Nigerian revenue context, trend, outlier states and outlook.
Our analysis showed that the whole of Northern and South Eastern Nigeria were heavily dependent on federal allocation. Although same was the case for South-South, but a growing IGR performance (for Cross River – 13b to 14b, Edo – 19b to 23b and Rivers – 82b to 85b in 2015 and 2016 respectively)if sustained and doubled up holds a likelihood of ‘less dependency’ on federal allocations. This therefore speaks of possible rising inequality gap in the region as Bayelsa, Akwa Ibom and Delta remain under the cloak of federal allocation.
South West Nigeria, presents a completely different story of huge revenue inequality and three outlier states that have completely defied the norm (Lagos, Ogun and Osun) showing IGR way over 70% and 50% (respectively) contribution to Total revenue in 2016.
Despite 13% Derivation Fund to Nine (9) states, only Lagos (being the lowest beneficiary) showed high level independence of the ‘special treatment’ fund for hosting the nation’s top revenue and foreign exchange resource – Crude Oil. High beneficiary states (Akwa-Ibom, Bayelsa, Delta and Rivers) still show huge dependence on the fund (FAAC). Also Edo state seem to show prospects of becoming like Lagos as it ranks second to the lowest beneficiary.
Therefore our top and next three states to watch for states ‘independency’ would include; Lagos, Ogun and Osun. While the next three would be Rivers, Edo and Cross river. See the results of our analysis.
Data Source – Nigerian bureau of Statistics (NBS), Analysis and Insights by Streetnomics.