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2018 Budget: FG increases budget by 15.5%

Projections contained in the Medium Term Expenditure Framework (MTEF) and Fiscal Sustainability Plan (FSP) of 2018 – 2020 shows that the Federal Government will spend N8.60trn in 2018. This exceeds the 2017 Budget of N7.44trn by 15.5% (about N1.16 trillion).

According to the MTEF, 43.2% of the budget is expected to come from oil sources, while the balance is to be earned from non-oil sources.

The expenditure would be financed through Federal Government revenue, estimated at N5.65trn, about 11% increase in the 2017 estimate of N5.08trn, in addition to a borrowing plan that is expected to fund the budget deficit, put at N3.52trn in 2018.

“Consumption expenditure is projected to grow from N83.66bn in 2018 to N107.77bn in 2020. These are reflective of a gradual recovery of the economy”.

Meanwhile, daily oil production is expected to be 2.4mbpd in 2019 and 2.5mbpd in 2020.

Fiscal Responsibility Act 2007 gives the National Assembly, authority to consider and approve the METF/FSP, before the estimates are presented to the Lawmakers.

“Fiscal deficit will be maintained within the 3% level stipulated by the Fiscal Responsibility Act 2007 but at an average of about 1.93% of GDP, but declining to less than 1% by 2020”.

Inflation is estimated to fall to 12.42% in 2018; while the Gross Domestic Product (GDP) is estimated to rise to 3.5%, up from the 1.5% in the current budget.

“The nominal GDP is expected to increase from N104.79bn in 2017 to N134.7bn in 2020.

Specific details of the 2018 budget are expected to be included in the estimates of the 2018 budget to be presented by President Muhammadu Buhari to the National Assembly.

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