Nigeria's Finance Minister, Wale Edun, Advocates Money Supply Discipline as FAAC Allocates N966 Billion for July 2023

Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, emphasized the importance of maintaining discipline in money supply to control inflation during the recent Federation Account Allocation Committee (FAAC) meeting. The committee shared a total sum of N966.110 billion among federal, state, and local government councils for July. Edun, presiding over the FAAC meeting, underscored the need for resource mobilization to achieve employment growth and poverty reduction, urging strict control of money supply to manage inflation.

The Nigeria Employers’ Consultative Association (NECA) called upon the newly appointed ministers, including Mr. Wale Edun, to take focused and immediate action in reshaping the economic trajectory of the nation. NECA highlighted the imperative to work collaboratively with the organized business community and enact reforms in the fiscal and monetary sectors. Additionally, NECA recognized the significance of finalizing labor law reviews, ensuring stability in the foreign exchange market, and fostering job creation.

July FAAC Meeting Highlights

During the July FAAC meeting presided over by Minister Edun, a total of N966.110 billion was distributed among federal, state, and local governments. This marked a notable increase of N59.056 billion compared to the previous month of June. The distributed revenue of N966.110 billion was derived from a gross revenue of N1,746.491 trillion. Of this amount, the federal government received N374.485 billion, states obtained N310.670 billion, and local government councils were allocated N229.409 billion. Additionally, N51.545 billion was designated for relevant states as 13% derivation revenue.

The Value Added Tax (VAT) revenue for July stood at N298.789 billion, showing a rise of N5.378 billion compared to June. The gross statutory revenue totaled N1,150.424 billion, indicating a slight decrease of N2.497 billion from the previous month. Further analysis revealed that the federal government received N190.489 billion from the distributable statutory revenue, while states and local government councils received N96.619 billion and N74.489 billion, respectively.

The Electronic Money Transfer Levy (EMTL) of N12.840 billion was divided as follows: the federal government received N1.926 billion, states were allocated N6.420 billion, and local governments obtained N4.494 billion. Additionally, from the Exchange Difference revenue of N283.904 billion, the federal government received N141.278 billion, state governments obtained N71.658 billion, and local government councils were allocated N55.245 billion. Furthermore, N15.723 billion was set aside for relevant states as 13% mineral revenue.

NECA's Expectations and Concerns

NECA emphasized the importance of coordinated efforts between the government and organized businesses to stimulate economic growth. They urged Minister Edun to focus on fiscal and monetary reforms, while emphasizing the need for stability in the foreign exchange market. NECA also underscored the significance of finalizing reviewed labor laws and encouraging job creation. Additionally, they highlighted the challenges posed by the removal of the fuel subsidy and urged expedited support for organized businesses to mitigate negative consequences and unemployment escalation.