Nigeria Grows Monthly Revenue by 26% Amidst COVID-19

July 20, 2020
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By Adedapo Adesanya

The Accountant General of the Federation, Mr Ahmed Idris, has disclosed that the gross revenue generated by Nigeria in the month June 2020 rose 26 per cent or N135.6 billion to N653.4 billion from N517.8 billion in May, increasing government allocations for the month.

This boost is coming as the country, Africa’s largest oil exporter, recorded higher crude and tax receipts in the sixth month of the year compared to the previous month, as oil prices recovered from a crash in April.

This was disclosed in a communiqué released by the Federation Account Allocation Committee (FAAC) after its monthly meeting for July held through virtual conferencing was chaired by the Accountant-General.

The coronavirus pandemic took its toll on the country’s revenue as crude prices dropped more than 50 per cent, leading to weakening of the Naira and creating a large financing gap that has led the country to seek loans from multilateral institutions.

After hitting a 21-year low around $16 per barrel in April, the Brent crude, the international benchmark, has made recovery, hitting a high of $43 per barrel so far.

Mr Idris said the government was able to generate N42.8 billion from exchange rate gains following the devaluation of the Naira from N306/$1 to N360/$1., while gross statutory revenue available in June was N524.5 billion, and the gross revenue from the Value Added Tax (VAT) was N128.8 billion.

Nigeria increased its VAT rate from 5 per cent to 7.5 per cent earlier this year increasing revenue accruable to the federation account.

This brought the total revenue for the month to N697.1 billion. From this total, N43 billion was transferred to the excess crude revenue account and the balance of N653.4 billion was shared to the three tiers of government and relevant agencies.

With this injection, the balance in the Excess Crude Account (ECA) as of July 16, 2020, was $72.4 million.

In the month, it was disclosed that the three tiers of government and other agencies shared a total of N653.4 billion from the June federation account revenue. The figure is N106 million or 19.4 per cent higher than N547.3 billion that was published in May 2020.

Business Post understands that the government is likely to generate more if it proceeds with the unification of the Naira, a line of action that the Minister of Finance, Mrs Zainab Ahmed has announced was in the works following calls from the International Monetary Fund (IMF).

Adedapo Adesanya

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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