Following the recent release of the 2021 budget by the President of the Federal Republic of Nigeria, there have been concerns over Nigeria’s debt stock as the nation plans to fund the 2021 budget deficit with N4.28 trillion new borrowings, a situation that has attracted huge backlash from the citizens. The proposed new borrowings represent about a third of the proposed budget. We explain further details on the proposed budget below while comparing it to the 2020 budget.
The proposed 2021 budget has a total expenditure of N13.08trillion while the 2020 budget had N10.81trillion, indicating a total change of 21% while the revenue in the proposed 2021 budget has been put at N7.88trillion while that of the 2020 budget was N5.84trillion with a change of about 35%. Thus, an aggregate sum of N3.85 trillion is expected to be available for capital projects in 2021.
Revenue generation remains government’s main challenge. In this regard, key revenue management measures introduced include deregulation of the price of petroleum products; ongoing verification exercise with IPPIS; and implementation of service-based electricity tariffs. We strongly believe that the exploitation of other sectors of the economy is very important in getting ahead of the revenue generation. We need to explore other sectors such as Agriculture, Technology etc. This will greatly improve in the revenue generation of the country instead of placing maximum focus on only a few sectors.
The 2021 Budget, which is themed the “Budget of Economic Recovery and Resilience”, is determined 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 quick passage of the Petroleum Industry Bill into law is expected to boost confidence and attract further investments into the oil and gas sector and increase the revenues. The Government is also committed to implementing programmes to lift 100 million Nigerians out of poverty over the next 10 years. Social safety nets will be implemented to cushion the effect of the most vulnerable of our citizens as well as business owners.