Economy
Nigeria Exits Global Tax Deal over Unreliability, Profit Reallocation Issues
By Adedapo Adesanya
Nigeria has opted out of a global tax deal negotiated under the Organisation of Economic Cooperation and Development (OEDC)/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS).
According to ThisDay Newspaper, Nigeria is one of the four countries alongside its African counterpart, Kenya as well as Pakistan and Sri Lanka that exited the deal.
For context, BEPS refers to corporate tax planning strategies used by multinationals to shift profits from higher tax jurisdictions to lower tax jurisdictions or no-tax locations where there is little or no economic activity, thereby eroding the tax base of the higher-tax jurisdictions using deductible payments such as interest or royalties.
Nigeria’s position was predicated, among others, on the unreliability of the economic impact of the deal for developing countries.
The OECD estimates that countries lose $100-$240 billion worth of revenue annually to BEPS practices, which is the equivalent to 4-10 per cent of the global corporate income tax revenue.
The deal set out to introduce a global minimum tax rate and new profit reallocation rules, which aim to give countries a fairer chance to collect tax revenues from multinational enterprises (MNEs) operating in or generating revenues from their jurisdictions.
In a new report titled, OECD Global Tax Deal: Key Elements, Opportunities and Challenges, Global Financial Integrity (GFI) stated that the framework represents a group of countries and jurisdictions working together to address systemic issues within the global taxation system that cause an inequitable distribution of tax revenues among countries and jurisdictions.
It operates under the leadership of the OECD, but any country or jurisdiction is allowed to join and participate.
The global tax deal represents a major reform to the rules governing the international tax system, aimed at bringing an end to tax havens and profit-shifting by multinational enterprises.
The deal specifically aims to address challenges that arise from the digitalisation of the economy and is broken down into two pillars.
Pillar 1 aims to reallocate multinationals’ profits and taxing rights to market jurisdictions while Pillar 2 introduces a global minimum tax rate.
The Inclusive Framework releases the blueprints for the two-pillar solution to address tax challenges arising from the digitalisation of the economy.
A total of 140 tax jurisdictions were part of the Inclusive Framework when the negotiations commenced, the report highlighted.
After the conclusion of the high-level agreement in October 2021, Mauritania joined the Inclusive Framework as the 141st member in November and also agreed to the two-pillar statement.
In total, 137 of the 141 member jurisdictions have agreed to the two-pillar solution while Kenya, Nigeria, Pakistan and Sri Lanka opted out.
However, Nigeria expressed concern with Pillar 1 particularly, claiming that the OECD’s assessment of the economic impact on developing countries was unreliable.
Also, the mandatory dispute resolution element was one of the reasons for Kenya and Nigeria to disapprove of the deal because of concerns around losing sovereignty due to tax issues having to be resolved in residence countries.
Although Nigeria made no disclosures of its own calculations on potential revenue, its conclusion was that it was not worth the high cost of implementation.
Some of the concerns around the deal and reasons why Nigeria and the other countries rejected it included: Lack of transparency in negotiations, exclusion of the majority of developing countries, the issue of too many MNEs out of scope, and limited impact on developing countries, among others.
According to the report, although the agreement was negotiated under the Inclusive Framework, a substantive part of the process was carried out within the G7 and G20.
This in turn made the process less transparent and gives rise to the concern that smaller and less rich countries were not given equal participation.
The newspaper also reported that the deal also excludes companies working in the extractives industry, although this sector has been flagged to be more susceptible to illicit financial flows.
Similarly, although the Inclusive Framework allows all interested jurisdictions and countries to become members, there are conditions and annual fees they have to commit to in order to join.
The majority of African (52 per cent) and Least Developed (78 per cent) countries have not joined the framework.
By Adedapo Adesanya
Nigeria’s economy, measured by gross domestic product (GDP), grew by 4.07 per cent (year-on-year) in real terms in the fourth quarter (Q4) of 2025.
The National Bureau of Statistics (NBS) announced the development in its latest GDP report for Q4 2025 on Friday.
The latest figure represents an improvement over the 3.76 per cent growth recorded in the corresponding period of 2024, signalling sustained recovery across key sectors of the economy. The growth rate was faster than the third quarter’s 3.98 per cent.
The report confirmed that Nigeria’s oil sector grew 6.79 per cent year-on-year and the non-oil part of the economy expanded by 3.99 per cent.
Nigeria’s average daily oil production stood at 1.58 million barrels per day in the final three months of 2025. That was lower than the third quarter’s output of 1.64 million barrels per day but higher than the 1.54 million barrels per day in the fourth quarter of 2024.
Breakdown of the data showed that the agriculture sector grew by 4.00 per cent in the fourth quarter of 2025. This marks a significant increase compared to the 2.54 per cent growth recorded in the same quarter of 2024, reflecting improved output and resilience in the sector.
The industry sector also recorded a stronger performance during the period under review. It grew by 3.88 per cent year-on-year, up from 2.49 per cent posted in the fourth quarter of 2024. The improvement suggests enhanced activity in manufacturing, construction, and related industrial sub-sectors.
The services sector maintained its position as a major growth driver, expanding by 4.15 per cent in Q4 2025. However, this was slightly lower than the 4.75 per cent growth recorded in the corresponding quarter of the previous year.
Overall, the 4.07 per cent GDP growth in the final quarter of 2025 underscores broad-based expansion across agriculture, industry, and services, despite a marginal moderation in services growth.
The Q4 performance provides further evidence of strengthening economic momentum, with improvements recorded in both agriculture and industry compared to the previous year.
By Modupe Gbadeyanka
For the second time, Flour Mills of Nigeria Plc is sponsoring the Paris International Agricultural Show (PIAS) as part of its strategies to fortify its ties with France.
The 2026 PIAS kicked off on February 21 and will end on March 1, with about 607,503 visitors, nearly 4,000 animals, and over 1,000 exhibitors in attendance last year, and this year’s programme has already shown signs of being bigger and better.
The theme for this year’s event is Generations Solution. It is to foster knowledge transfer from younger generations and structure processes through which knowledge can be harnessed to drive technological advancement within the global agricultural sector.
In his address on the inaugural day of the Nigerian Pavilion on February 23, the Managing Director for FMN Agro and Director of Strategic Engagement/Stakeholder Relations, Mr Sadiq Usman, said, “At FMN, our mission is Feeding and Enriching Lives Every Day.
“This is a mandate we have fulfilled through decades of economic shifts, rooted in a culture of deep resilience and constant innovation. We support this pavilion because FMN recognises that the next frontier of global Agribusiness lies in high-level technical exchange.
“We thank the France-Nigeria Business Council (FNBC), the organisers of the PIAS, and our fellow members of the Nigerian Pavilion – Dangote, BUA, Zenith, Access, and our partners at Creativo El Matador and Soilless Farm Lab— we are exceedingly pleased to work to showcase the true face of Nigerian commerce.”
Speaking on the invaluable nature of the relationship between Nigeria and France, and the FMN’s commitment to process and product innovation, Mr John G. Coumantaros, stated, “The France – Nigeria relationship is a valuable partnership built on a shared value agenda that fosters remarkable Intercontinental trade growth.
“Also, as an organisation with over six decades of transformational footprint in Nigeria and progressively across the African Continent, FMN has been unwaveringly committed to product and process innovation.
“Therefore, our continuous partnership with France for the success of the Paris International Agricultural Show further buttresses the thriving relationship between both countries.”
PIAS is one of the most widely attended agricultural shows, with thousands of people from across the world in attendance.
By Adedapo Adesanya
Despite reservations from some quarters, the Nigeria Extractive Industries Transparency Initiative (NEITI) has praised President Bola Tinubu’s Executive Order 9, which mandates direct remittances of all government revenues from tax oil, profit oil, profit gas, and royalty oil under Production Sharing Contracts, profit sharing, and risk service contracts straight to the Federation Account.
Issued on February 13, 2026, the order aims to safeguard oil and gas revenues, curb wasteful spending, and eliminate leakages by requiring operators to pay all entitlements directly into the federation account.
NEITI executive secretary, Musa Sarkin Adar, called it “a bold step in ongoing fiscal reforms to improve financial transparency, strengthen accountability, and mobilise resources for citizens’ development,” noting that the directive aligns with Section 162 of Nigeria’s Constitution.
He noted that for 20 years, NEITI has pushed for all government revenues to flow into the Federation Account transparently, calling the move a win.
For instance, in its 2017 report titled Unremitted Funds, Economic Recovery and Oil Sector Reform, NEITI revealed that over $20 billion in due remittances had not reached the government, fueling fiscal woes and prompting high-level reforms.
Mr Adar described the order as a key milestone in Nigeria’s EITI implementation and urged amendments to align it with these reforms.
He affirmed NEITI’s role in the Petroleum Industry Act (PIA) and pledged close collaboration with stakeholders, anti-corruption bodies, and partners to sustain transparent management of Nigeria’s mineral resources.
Meanwhile, others like the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) have kicked against the order, saying it poses a serious threat to the stability of the oil and gas industry, calling it a “direct attack” on the PIA.
Speaking at the union’s National Executive Council (NEC) meeting in Abuja on Tuesday, PENGASSAN President, Mr Festus Osifo, said provisions of the order, particularly the directive to remit 30 per cent of profit oil from Production Sharing Contracts (PSCs) directly to the Federation Account, could destabilise operations at the Nigerian National Petroleum Company (NNPC) Limited.
Mr Osifo firmly dispelled rumours of imminent protests by the union, despite widespread claims that the controversial executive order threatens the livelihoods of 10,000 senior staff workers at NNPC.
He noted, however, that the union had begun engagements with government officials, including the Presidential Implementation Committee, and expressed optimism that common ground would be reached.
Mr Osifo, who also serves as President of the Trade Union Congress (TUC), expressed concerns that diverting the 30 per cent profit oil allocation to the Federation Account Allocation Committee (FAAC), without clearly defining how the statutory management fee would be refunded to NNPC, could affect the salaries of hundreds of PENGASSAN members.
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