The Federal Executive Council (FEC) on Wednesday approved the 2021-2023 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) with N12.66 trillion budget projection for each of the three fiscal years.
Briefing State House Correspondents at the end of the FEC meeting presided over by President Muhammadu Buhari which lasted well over eight hours, the Minister of State for Finance, Budget and National Planning, Clement Agba, listed other projections in the budget to include $40 per barrel oil benchmark, oil production volume of 1.6 million barrel per day, inflation rate of 11.9 percent, projected gross domestic growth rate of 3 percent and revenue target of N7.50 trillion.
On projected revenue for 2021, Agba said “for 2020 it was N5.84 trillion but for 2021 we expect that it will be N7.50 trillion”.
“Even though the oil production is much lower than our capacity, because we are restricted by the OPEC+ quota in order to get the prices at par, we have brought in 63 Government Owned Enterprises(GOE). We are bringing them into the budget order to be able to shore up the budget by additional N2.17 trillion into the budget, hence we are saying we are projecting a larger budget size for 2021 over and above the N10.84 trillion for the revised 2020 budget,” Agba said.
“When you look at the N7.5 trillion and the expectations to spend N12 trillion, yes, definitely there will be gap and that gap has to be financed.
“Is there plan for borrowing payment? Yes, there is. Even in the 2020 budget we had provisions to repay debt and in the 2021 there is provision to repay debt. There is a sinking fund, we look at the ratio and ensure that we are able to pay our debts. Of course that is why we have the Debt Management Office to run those numbers and advise us,” he said.
Details later…
