The Nation Newspaper MTEF: Fed govt projects three years economic growth
plans to rebuild the economy over the next three years based on critical data just released in Abuja.Government, according to the Medium Term Expenditure Framework and Fiscal Strategy Paper 2024 to 2026, has set the oil benchmark price for the three years running from 2024 to 2026 at $73.96; $73.76; and $69.90 respectively.
The projected exchange rates for the Nigerian Naira against the U.S. Dollar are 700 Naira to 1 Dollar in 2024, 665.61 Naira to 1 Dollar in 2025, and 669.79 Naira to 1 Dollar in 2026. These rates reflect the assumed values used for currency conversion in economic calculations. Imports, which are the estimated total value of goods and services imported into Nigeria, are expected to increase over the three-year period, while nominal consumption which represents the estimated total value of goods and services consumed in the Nigerian economy is projected to increase steadily.
The document adds that “most of the growth in real GDP during the period will be driven by the anticipated increase in domestic oil refining capacity, telecommunications, crop production, slight growth in investment and employment, with the bulk of projected growth coming from the non-oil sector. Imports, the document says, “will remain high over the medium term due to the weak import substitution capacity occasioned by inefficient domestic production relative to more efficient foreign producers. The real economy is experiencing sustained inflationary pressures, worsened by high energy costs, and a depreciating Naira.”
Total oil revenues will be N13.82 trillion, about 56.3% of total Federation Account receipts and 66.8% of Main Pool receipts. Other components of the Federation Account revenues include Corporate Tax of N3.04 trillion, Customs Revenue of N2.65 trillion, Special Levies of N511.88 billion, NLNG Dividend of N667.95 billion, and revenues from Solid Minerals of N9.39 billion.
More dividends from the Bank of Industry, Development Bank of Nigeria, Galaxy Backbone, and Bank of Agriculture are recognised in the 2024 projections, bringing the projection to N316.68 billion compared to N81.79 billion in 2023. The projected sum of other revenues, including FGN’s share of Oil Price Royalty, Education Tax, Electronic Money Transfer Levy, and Drawdowns from Special Accounts, is N736.04 billion.The FGN’s 2024 aggregate expenditure is estimated at N26.01 trillion.
The aggregate amount available for capital expenditures in the 2024 budget is N6.87 trillion. This represents 26% of total expenditure and is about 5% less than the 2023 provision of N7.27 trillion. The 2024 provision comprises N2.31 trillion for MDAs, N855.70 billion for capital supplementation, N908.09 billion for capital component of statutory transfers, N7 billion for Family Home Fund, N820.91 billion capital budget of GOEs, N639.92 billion for donor/grant funded expenditures and N941.
The assumptions underlying the non-oil revenue forecasts for the period 2024-2026 are based on the declining revenue from crude oil. Government has continued to implement various reform measures to further widen the revenue base, modernise and further improve tax administration, and enhance non-oil revenue collections.
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