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2023: Nigeria’s President Buhari, presents ₦20.51 trillion budget of ‘Fiscal Consolidation and Transition’ to National Assembly

Published

2 years ago

October 7, 2022

Nigeria’s President Muhammadu Buhari, has presented the country’s 2023 budget tagged “Budget of Fiscal Consolidation and Transition” to the joint session of Nigeria’s National Assembly.

The N20.51 trillion worth budget had oil, which is Nigeria’s major revenue source benchmarked at $70 per barrel, putting Nigeria’s budget deficit will widen to 4.78%.

President Buhari said the budget was “prepared amidst a very challenging world economy that is weakened by the lingering effects of the COVID-19 pandemic, high inflation, high crude oil prices resulting in the huge cost of PMS Subsidy and negative spillover effects of the Russia-Ukraine war.”

Nigeria pegged daily oil production estimate of 1.69 million barrels (inclusive of Condensates of 300,000 to 400,000 barrels per day); exchange rate of 435.57 Naira per US Dollar; the projected GDP growth rate of 3.75 percent and 17.16 percent inflation rate.

Nigeria’s current fiscal life is faced with rising public debt, industrial-scale oil theft, and the big white elephant – fuel subsidy. Thus inciting doubt among observers on the country’s ability to meet its financial projection according to the budget.

President Buhari hinted that the country will eventually stop payment of fuel subsidy will rise to 20.51 trillion naira ($47.4 billion) next year, up 18.4% from this year.

“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.

Nigeria’s economy is projected to grow 3.7% next year, up from 3.55% this year while annual inflation is forecast to remain in double digits, averaging 17.16%.

With the general elections due for February and March 2023 and the change of leadership in the West African country, a lot might be rightly judged as uncertain considering Nigeria’s complex and peculiar nature.

Related Topics:2023 BUDGET Featured Nigeria

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Nigerian govt denies reports it plans to borrow pension fund for infrastructure

Published

21 hours ago

May 17, 2024

Ifeoluwa Dada

The Nigerian government has denied reports that it plans to borrow the N20tn pension fund to finance infrastructural projects.

In a statement made in Abuja, Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, stated that the government would abide by the laws and guidelines in place pertaining to the pension fund.

Following a two-day Federal Executive Council meeting at the Presidential Villa on Tuesday, the minister reportedly informed reporters that the government would present a plan to use local funds, including the fund, to finance infrastructure development.

Edunstated that the government does not intend to exceed these legal boundaries, emphasising that the government was committed to protecting workers’ pensions.

“It has come to my notice that stories are making the round that the Federal Government plans to illegally access the hard-earned savings and pension contributions of workers. Nothing could be farther from the truth.

“The pension industry, like most the financial industries, is highly regulated. There are rules. There are limitations about what pension money can be invested in and what it cannot be invested in.

“The Federal Government has no intention whatsoever to go beyond those limitations and go outside those bounds which are there to safeguard the pensions of workers.

“What was announced to the Federal Executive Council was that there was an ongoing initiative drawing in all the major stakeholders in the long-term saving industry, those that handle funds that are available over a long period to see how, within the regulations and the laws; these funds could be used maximally to drive investment in key growth areas,” Edun clarified.

The plan to spend the pension fund was reported and was widely criticised. The Trade Union Congress of Nigeria and the Nigeria Labour Congress had earlier on Thursday urged the government to abstain from making any changes to the pension fund.

They stated, “Nigerian workers have entrusted their hard-earned savings for retirement security, not as a means for government projects. It is imperative to halt any further plans to tap into these funds, especially given the lack of transparency and accountability in past government borrowing practices.”

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Nigeria’s inflation hits 28-year high of 33.69% in April

Published

2 days ago

May 16, 2024

Ifeoluwa Dada

Nigeria’s consumer inflation reached a 28-year high of 33.69% in April, up from 33.20% in March, according to statistics agency figures released on Wednesday.

President Bola Tinubu’s administration has slashed petrol and energy subsidies and devalued the local naira currency twice.

To manage pricing pressures, the central bank has hiked interest rates twice this year, including the highest hike in almost 17 years. The central bank governor has stated that rates will remain high for as long as necessary to reduce inflation. The bank will host another rate-setting meeting next week.

When compared to the previous year, the inflation rate in April 2024 was 11.47 percentage points more than in April 2023, when it stood at 22.22 percent. This implies that the headline inflation rate has increased dramatically during the last year.

According to the National Bureau of Statistics, food and nonalcoholic beverages remained the largest contributor to inflation in April. Food inflation, which accounts for most of the inflation basket, rose to 40.53% yearly from 40.01% in March.

Price pressures have left millions of Nigerians facing the biggest cost-of-living crisis in decades, as they fight to satisfy their most basic necessities.

Tinubu has offered a 35% salary increase for state personnel to alleviate pressure on government workers. To assist disadvantaged households, his government has resumed a direct cash transfer program and provided at least 42,000 tons of grains such as corn and millet.