Nigeria's 2023 budget deficit seen at 4.78%, to stop fuel subsidy

However, its current fiscal impact has clearly shown that the policy is unsustainable," Buhari said in his last budget speech before the election.

Nigeria's budget deficit will widen to 4.78% next year on the back of higher spending, President Muhammadu Buhari said in a budget speech, adding Africa's biggest economy could no longer continue its fuel subsidy policy.

Buhari's government had planned to remove the subsidy - which is expected to cost up to $9.6 billion this year - as part of fiscal and petroleum sector reforms but walked back on the plans early this year fearing they could stoke protests. It has become one of the major campaign issues for the presidential elections in February to replace Buhari.

"Petrol subsidy has been a recurring and controversial public policy issue in our country since the early eighties. However, its current fiscal impact has clearly shown that the policy is unsustainable," Buhari said in his last budget speech before the election.

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