Economy

Federal Government Approves N10.52tn For Revised 2020 Budget

Published

4 years ago

2020/05/13

The federal government has approved N10.523 trillion for revised 2020 national budget.

This followed a memo submitted by the ministry of finance, budget and national planning to the National Executive Council (FEC) for approval of the amendments of the Medium Term Expenditure Framework for 2020-2022 as well as amendment to the 2020 budget.

The minister of finance, budget and national planning, Zainab Ahmed, who briefed State House reporters, said the revised budget had a difference of about N71.5 billion when compared to the approved budget.

Hajiya Zainab, who said the council approved the ministry’s recommendations and key parameters, stated that the crude oil price was approved at $25 per barrel, while crude oil production was okayed at 1.94 million barrels per day and an exchange rate of N360 to $1.

She said the size of the budget was cut down, while new expenditure previously not budgeted was brought in to enable government “adequately respond to the COVID-19 pandemic.”

President Buhari had in December 2019 assented to N10.59tn 2020 budget.

The National Assembly had passed the budget at $57 per barrel oil benchmark price.

However, the federal government had to review the budget because of the current drop in the price of crude oil due to the coronavirus pandemic.

The global crude oil prices are now currently oscillating between 29 and 30 dollars.

The minister spoke further on the revised budget: “The federal government in this budget will have direct revenue of funding the budget of N5.158 billion. The deficit to this budget N5.365 trillion and this will be financed by both domestic as well as foreign borrowing. The foreign borrowing we are doing for 2020 are all concessionary loans from the IMF which has already been approved and has crystallized, from the World Bank, Islamic Development as well as Afro EXZIM bank.

“There will also be some drawdown of previously committed loans for major ongoing projects that we will be drawing from both exiting facilities as well as some special accounts with the approval of Mr President and the National Assembly. And also from revenue that we are expecting to realize from privatization. So, the borrowing, the multilateral loans draw down coming from special accounts and coming from the privatization will fund the fiscal deficit of N5.365 trillion that we have in the proposed amendment of the 2020 budget.”

The minister, who spoke on the loans mentioned by the minister of agriculture and rural development, Sabo Nanono, said the FEC also approved the proposal of the Nigeria Customs Service to purchase nine Fast Ballistic Riverine Patrol Boats and nine versatile logistics boats manufactured in Nigeria for its surveillance and anti-corruption activities on the maritime waters at the sum of N505,787,199.75 (including 7.5% VAT).