Budget and Plans | |
Budget and Plans | |
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Friday,
October 09, 2020 / 08:33 AM / By KPMG Nigeria / Header Image Credit: Vanguard News
His Excellency, the President of the Federal Republic
of Nigeria, Muhammadu Buhari, GCFR, today 8 October 2020, presented the 2021
Federal Government Budget Proposals before a joint sitting of the National
Assembly. The proposed Revenue and Expenditure budgets for 2021 are N8.43 trillion and N13.08 trillion,
respectively, resulting in N4.65 trillion fiscal deficit.
Below are the key assumptions behind the budget and
movements in the proposed fiscal parameters between the revised 2020 and 2021
Budgets:
Budget Assumption/ Fiscal Parameter |
2020 Approved Budget |
2020 Revised Budget |
2021 Proposed Budget |
Percentage change |
Benchmark oil price |
US$57
per barrel |
US$28 per barrel |
US$40 per barrel |
43% |
Oil production volume (bpd) |
2.18 million |
1.80 million |
1.86 million |
3% |
Inflation Rate (%) |
10.81 |
14 |
11.95 |
-15% |
Average exchange rate |
N305/ US$1 |
N360/ US$1 |
N379/ US$1 |
5% |
GDP growth rate (%) |
2.93 |
-4.42 |
3 |
168% |
Capital expenditure |
N2.47 trillion |
N2.69 trillion |
N3.85 trillion |
43% |
Statutory transfer |
N0.56 trillion |
N0.43 trillion |
N0.48 trillion |
13% |
Debt service |
N2.43 trillion |
N2.68 trillion |
N3.12 trillion |
16% |
Recurrent expenditure (non-debt) |
N4.49 trillion |
N4.94 trillion |
N5.65 trillion |
14% |
Total revenue |
N8.42 trillion |
N5.84 trillion |
N8.43 trillion |
44% |
Total expenditure |
N10.59 trillion |
N10.81 trillion |
N13.08 trillion |
21% |
Fiscal deficit |
N2.17 trillion |
N4.98 trillion |
N4.65 trillion |
-7% |
Source: Ministry of Budget and National Planning; 2020 Appropriation Act
The 2021 Budget, which has been themed the "Budget
of Economic Recovery and Resilience", is designed to deliver on the
Government's Economic Sustainability Plan goals, accelerate the pace of
Nigeria's economic recovery, promote economic diversification, enhance
competitiveness and ensure social inclusion.
The President used the opportunity of the 2021 Budget
presentation to announce the preparation of the Finance Bill, 2020 by the
Honourable Minister of Finance, Budget and National Planning for passage with
the 2021 Appropriation Bill. The Finance Bill, 2020 will seek to support
the realization of the 2021 revenue projections, adopt appropriate
counter-cyclical fiscal policies and enhance the efficiency of fiscal
incentives.
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