Nigeria’s foreign exchange revenue surges to N1.36trn in six months — FAAC reports
By Sodiq Adelakun
Nigeria has experienced a substantial increase in revenue from foreign exchange differences, totaling N1.36 trillion over a six-month period, according to recent data from the Federation Account Allocation Committee (FAAC) communiques.
The remarkable rise in profits is attributed to the gains from foreign exchange revaluation following the depreciation of the naira.
The local currency has weakened to N825 against the US dollar, a significant drop from its 2022 closing rate of N461.50 to the dollar.
FAAC reports showed a progressive increase in the foreign exchange difference, which surged from a mere N0.639 billion in June to a staggering N364.87 billion by November.
The government’s distribution of these gains included N320.89 billion in July, N229.67 billion in August, N186.81 billion in September, and N262.89 billion in October.
The document provided detailed insights into the distribution of the accrued revenue among the federal, state, and local governments. After statutory deductions, which include a 13 percent derivation and other charges, the state governments received N317.36 billion, while local governments were allocated N244.66 billion over the same period.
The current vertical allocation formula stipulates that after deductions, the Federal Government receives 52.68 percent, state governments get 26.72 percent, and local governments receive 20.60 percent of the net distributable federation account revenue.
Out of the Federal Government’s share, allocations are made for various purposes: one percent for general ecological problems, one percent for the Federal Capital Territory, 1.68 percent for the development of natural resources, and 0.5 percent for statutory stabilization.
The remaining 48.5 percent is retained by the Federal Government. In a related development, it has been reported that no fewer than 13 state governments have reaped significant profits from foreign exchange revaluation, amounting to N71.59 billion within a three-month timeframe, further highlighting the impact of the naira’s depreciation on the country’s revenue streams.
This was disclosed through data obtained from the third quarter budget implementation report (July to September) on each state’s website.
Among the 13 States, Akwa-Ibom had the highest earning at (N10.2bn), followed by Jigawa (N7.23bn), Imo (N6.26bn).
It was followed by Kogi (N5.92bn), Nasarrawa (N5.75bn), Plateau (N5.65bn), Abia (N5 34bn), Adamawa (5.34bn) Enugu (N5.1bn) and Zamfara (N5.02bn).
It was also observed that Bauchi got the lowest profit of N120m, while Ebonyi received N4.79bn, Osun got N4.89bn.
