State of States 2025: Anambra top states able to cover its expenditure without borrowing
Anambra, Akwa Ibom, and Ebonyi have emerged as the top three states in Nigeria capable of funding their expenditures without resorting to borrowing, according to the 2025 State of States Report released by BudgIT.
The report, which evaluated the fiscal performance of 35 subnationals under its Index B category, ranked Anambra as the most financially self-sufficient with a score of 0.21, followed by Akwa Ibom with 0.24 and Ebonyi with 0.27.
BudgIT explained that “states that rank higher on Index B have comparatively more public revenue left to implement the capital expenditure components of their budgets after fulfilling repayment obligations to lenders and their government’s operating expenses.”
However, some states recorded weak fiscal positions, reflecting higher dependency on borrowing to fund their budgets. Cross River ranked lowest with a score of 0.98, while Ogun and Plateau followed with 0.86 each.
According to the report, “States that rank lower on Index B have comparatively less revenue left to implement the capital expenditure components of their budgets and thus face a greater risk of resorting to more borrowing or risk of under-implementing their capital budget.”
To address this fiscal gap, BudgIT advised lower-ranking states to adopt innovative financing mechanisms such as Public-Private Partnerships (PPP) to fund key infrastructure and public service projects.
Read also: Anambra, Lagos, Kwara top five best-performing states in Nigeria – BudgiT
“These lower-ranking states can adopt Public-Private Partnership (PPP) models in delivering public goods due to their constrained revenue,” the report added.
The 2025 State of States Report also highlighted an improvement in the total recurrent revenue of Nigeria’s subnational governments. BudgIT revealed that the cumulative recurrent revenue of the 35 states expanded significantly, rising from N6.6 trillion in 2022 to N8.66 trillion in 2023 and further to N14.4 trillion in 2024, representing a 66.28 percent growth, which far exceeds the 28.95 percent growth rate recorded between the 2022 and 2023 fiscal years.
Lagos State once again accounted for the highest share of the total recurrent revenue among all subnationals. However, its proportion of the cumulative figure dropped slightly compared to the previous year.
The report stated, “It should be noted that Lagos again took the highest share of this total recurrent revenue. But unlike 2023 (where Eko’s total revenue was 14.32 percent of the cumulative revenue of the subnationals), Lagos was down to 13.42 percent of the total subnational recurrent revenue, about N1.93 trillion.”
BudgIT further noted that Gross FAAC transfers to states have grown substantially over the past decade, reflecting higher allocations from the Federation Account
States such as Oyo (785.79 percent), Delta (708.36 percent), Niger (683.61 percent), Ekiti (680.22 percent), Gombe (643.23 percent), and Anambra (640.98 percent) recorded over 600 percent growth in their Gross FAAC receipts between 2015 and 2024.
In contrast, states like Adamawa (230.98 percent), Imo (225.25 percent), Ogun (223.87 percent), Ebonyi (205.31 percent), Kogi (186.32 percent), and Kebbi (178.03 percent) did not exceed 300 percent growth over the same period, indicating relatively slower fiscal momentum.
Overall, the total Gross FAAC distributed to the 35 subnationals surged to N11.38 trillion in 2024, representing an increase of 110.74 percent compared to N5.4 trillion in 2023.
