A budget deficit of around N5.2 trillion, which stands at roughly 50% of Nigeria’s newly downward revised N10.276 trillion budget will pose a new challenge to the cash-strapped Federal Government now faced with limited options for raising capital.
The deficit of around N5.2trn is the difference between the N10.276 spending plan and projected revenue of N5.086trn made in the light of bleaker revenue prospects for the oil dependent country.
The budget gap has more-or-less doubled from the previously approved budget following a slashing of oil production target from 2.18 mbpd to 1.7 mbpd and oil price cut to $30 per barrel from $57. Non-oil revenue targets were also adjusted.
The FG has announced plans to seek non-commercial loans and suspended its Eurobonds plans following dire market conditions that have presents it with limited options for raising capital.
