Nigeria to Finance 35% of 2024 Budget from Borrowing

October 24, 2023
Finance 35% of 2024 Budget

By Adedapo Adesanya

The federal government has disclosed plans to borrow N9 trillion from the debt market to fund 35 per cent of next year’s budget, according to Mr Ben Akabueze, the Director General of Budget of the Federation.

Speaking on the sidelines of the 29th Nigerian Economic Summit in the capital, Abuja on Monday, he said that the remaining 65 per cent or N17 trillion will be raised from revenue, meaning that the rest will be balanced from borrowing.

“We are going to spend 26 trillion and we are looking to raise 17 trillion in revenue and the balance in debt,” Mr Akabueze said in an interview on Monday.

The federal government intends to spend some N26.01 trillion in 2024 which is 14.8 per cent or about N3.36 trillion higher than the corresponding 2023 estimated spending of N22.65 trillion which includes the N819.54 billion supplementary provision.

Out of the planned spending, N8.25 trillion and N243 billion have been provided for debt service and sinking funds to retire maturing bonds issued to local contractors and creditors, respectively.

The budget which will cover the first full year of President Bola Tinubu’s administration since he mounted office in May will seek to map out some cost-cutting measures to drive good governance, according to Mr Akabueze during the public consultation of the draft FGN 2024-2026 Medium Term Fiscal Framework and Fiscal Strategy Paper (MTEF/FSP) at the summit.

He said this will include a possible review of the 2007 Public Procurement Act as it looks for ways to improve efficiency, and value for money, as well as reduce corruption.

The FG has also slashed its own 2024 budget deficit to N9.05 trillion, 22 per cent lower than the N11.60 trillion budgeted in 2023, and it says it intends to keep the figure with the 3 per cent threshold as stipulated in the 2007 Fiscal Responsibility Act (FRA), going forward.

The proposed deficit represents about 53 per cent of its total revenues and 3.83 per cent of the estimated gross domestic product (GDP).

Approaching the debt market is a new development as Mr Wale Edun, the country’s minister of finance said there was no intention to borrow from any local or foreign organization at the inaugural Federal Executive Council (FEC) meeting on Monday, August 28.

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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