Trade ministry: FG slashes 2026 budget by 22.92% amid investment gains

By Progress Godfrey 

ABUJA — The Federal Government has cut down the 2026 budget of the Federal Ministry of Industry, Trade and Investment by 22.92 percent, despite rising investment inflows and renewed trade momentum.

According to figures contained in the 2026 Appropriation Bill, the ministry’s total allocation for 2026 was cut to N87.44 billion, down from N110.07 billion in 2025 and N126.57 billion in 2024, reflecting a sustained fiscal tightening drive and a rebalancing of capital priorities across ministries.

A breakdown of the 2026 proposal shows that personnel cost rose slightly to N26.44 billion from N25.63 billion in 2025, and overhead expenditure also increased marginally to N5.60 billion, compared with N5.30 billion in the previous year.

Vanguard had earlier reported that foreign investments into Nigeria rose sharply in the first nine months of 2025, with combined Foreign Portfolio Investment and Foreign Direct Investment climbing to nearly $14 billion, exceeding total inflows recorded in the whole of 2024 and pointing to a strong rebound in capital inflows.

Nigeria also recorded a N12 trillion trade surplus in the first half of 2025, with non-oil exports posting a 21 percent growth to $12.8 billion.

The Ministry of Industry, Trade and Investment emphasised Nigeria’s leadership role within the African Continental Free Trade Area, noting its growing influence in driving trade expansion and investment flows across the continent.

However, capital expenditure in the 2026 budget recorded a sharp contraction, falling to N55.40 billion in 2026 from N79.14 billion in 2025. The reduction in capital votes accounted for the bulk of the overall budget cut, pointing to a tighter funding environment for trade infrastructure, industrial parks and export support programmes.

Key agencies under the ministry also recorded notable reductions. The Oil and Gas Free Zones Authority of Nigeria (OGFZA) was allocated N13.29 billion for 2026, down from N18.98 billion in 2025.

Similarly, the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) headquarters saw its budget cut to N28.59 billion from N40.13 billion a year earlier.

The reductions come as SMEDAN targets the registration of at least 250,000 new businesses in 2026, while also pushing for presidential approval to onboard an additional one million small enterprises.

In its 2026 outlook, the agency disclosed that it is seeking approval from the Central Bank of Nigeria (CBN) to operate a microfinance bank, a move aimed at enabling direct disbursement and tighter monitoring of funds for small businesses, while also strengthening access to international development finance.

Analysts say the squeeze on capital expenditure could test the ministry’s capacity to deliver on its trade, investment and SME development mandate, even as government leans more heavily on private capital and policy reforms to drive economic expansion.

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