Report: Nigeria Failing to Reflect Foreign Aid in National Budgets

A new report by the Organisation for Economic Co-operation and Development (OECD) and the United Nations Development Programme (UNDP) reveals that Nigeria is failing to accurately reflect foreign aid in its national budgets. According to the report, "Making Development Co-operation More Effective Progress Report 2026," only 35% of development cooperation flow indicators can be tracked using government data.

The government currently records no development cooperation flows on its national budget, limiting scrutiny of external resources, the report notes. This situation is a sharp decline from 49% recorded in 2018 and significantly restricts the integration of external funds into Nigeria's formal budgeting process. Of the 44 partner countries assessed, Nigeria stands out for its strong stakeholder engagement in national development strategies, yet the external development resources are not fully incorporated.

The report highlights a significant gap between development partners' stated alignment with Nigeria's development priorities and their use of national systems. While 99% of development partners' project objectives align with country-owned results frameworks, only 35% of the indicators can be monitored using government systems, indicating a disconnect between development projects and Nigeria's own data infrastructure.

The government has pledged to record all development cooperation flows in the national budget with quarterly breakdowns by the 2027 fiscal cycle. Additionally, Nigeria aims to integrate development cooperation reporting into parliamentary budget sessions and achieve 100% quarterly reporting compliance by 2027. Development partners have also committed to increasing their use of Nigeria's public financial management systems to 75% by 2028 and securing three-year forward-spending plans from at least 80% of partners by 2027.