Nigeria’s annual budget is about $27 billion. Let’s assume that we correct for corruption and can conservatively quadruple that amount…Nigeria’s budget will now be $100 billion! But sadly, even that amount is still not enough to run Nigeria a country of a 180 million plus people!
To understand how small and unrealistic Nigeria’s budget is, the US annual “defense” budget not the entire budget, just the money spent on the Military is close to $600 billion.
And I know people will say “but Nigeria is not America”
But then consider this … the annual budget of Texas 1 of America’s 50 states is $209 billion. That is 10 times Nigeria’s annual budget!
The secret as to why the US revenue is so high as compared to Nigeria is really not a secret.
It is simply that they get over 90% of their revenue from taxes, while Nigeria on the other hand gets 85% of her revenue from Oil and Gas. This is Nigeria’s core issue mixed with the fact that Nigerians for the most part falsely believe that we have enough Oil money to build Nigeria like say a Dubai…but I digress…
To make matters worse, only about 15% of the Nigerian budget goes towards capital expenditure while the remaining 85% goes towards reoccurring expenses like salaries, silly pilgrimages and fuel subsidy type expenses. Thus the money left for capital expenditure projects such as new roads, airports, power-plants is about $3 billion! And let’s not forget that the Federal government still has to take care of the 36 states of Nigeria in that same budget.
To fully understand how useless $3 billion is, all you have to do is to look at one of the capital projects carried out in Texas. It was for a Houston Metro-Rail expansion, not a new system…an expansion. And that rail expansion cost $1.3 billion not for a Nation or a state but for a single city! That is about 50% of what Nigeria has to spend annually on capital expense per our budget. #Crazy
When you factor all this in then you begin to understand the poor reality of Nigeria and that is that even if Oil was to rise today to a $100+ a barrel … Nigeria will still be broke because since 1980-something our primary source of revenue has been an Oil and that Oil cannot support an entire nation as big as Nigeria.
Why our people focus on corruption daily is quite befuddling. It’s like a glaring gap … because even if somehow we are able to eliminate all the corruption in Nigeria but do not create NEW streams of revenue (other than Oil) Nigeria will not and cannot develop. This is our mathematical reality.
So for Nigeria to build state of the art Universities, Airports, Railroads and others … we would need to introduce a state of the art taxation system similar to the United States … fortunately we don’t need to go far…
We already have a well-tested and successful system in Lagos as executed by it government. What we have to do now is to expand the Lagos-State model to the Federal level and teach other Governors how to replicate the idea in their States.
Only when we do that … when we (you and me) start paying taxes regularly … only then can Nigeria be really ready to experience true CHANGE. #NumbersDoNotLie