“The exchange rate of the Naira to the dollar, which was N379 in the 2021 budget, has been adjusted to the NAFEX rate of N410.15 to one US dollar."
The federal government has projected Nigeria’s Gross
Domestic Product (GDP) to grow by 4.2 per cent in 2022.
The Minister of Finance, Budget and National Planning,
Zainab Ahmed, said this at the Public Consultation on the Draft 2022 to 2024
Medium Term Fiscal Framework and Fiscal Strategy Paper (MTFF/FSP) on Thursday.
Mrs Ahmed said the GDP, projected in 2021 to rise three
per cent, had been adjusted downwards to close at 2.5 per cent.
“In 2022, we are expecting an uptake to 4.2 per cent,
then a dip to 2.3 per cent in 2023 and up to 3.3 per cent in 2024.”
The minister further said the Nominal GDP projected for
2022 was N184.38 trillion up from N168.6 trillion in 2021, and then to N201
trillion in 2023 and N222 trillion in 2024.
She also said the inflation rate was expected to drop slightly to 13 per cent in 2022 from 15 per cent in 2021.
She noted that the increase in inflation was due to the
exchange rate.
“Inflation rate, which was planned for 11.95 per cent in
2021, has been reflected in reality because the exchange rate is high. The
average we have so far is 15 per cent.
“We are expecting 2022 to go down slightly to 13 per cent, then 11 per cent in 2023 and 10 per cent in 2024.”
She, however, said the federal government had put the
Nigerian Autonomous Foreign Exchange Rate Fixing (NAFEX) rate of N410.15 to one
US dollar for 2022 to 2024.
“The exchange rate of the Naira to the dollar, which was
N379 in the 2021 budget, has been adjusted to the NAFEX rate of N410.15 to one
US dollar.
“We are assuming, for now, the same rate for 2022, 2023 and 2024.”
Federal Allocation
Furthermore, Mrs Ahmed took an overview of the federation
and fiscal outcomes for the Federation and Value Added Tax (VAT) Pool Accounts
Distributable for January to May.
She said the amount available for distribution from the
Federation Account was N2.78 trillion.
“Of this amount, the Federal Government received N998.57
billion, while the states and Local Governments received N506.59 billion and
N390.48 billion respectively from the Main Pool Account.
“Federal, state and local governments received N132.70
billion, N442.33 billion and N309.63 billion respectively from the VAT Pool
Account.”
Also, the minister said the gross oil and gas revenue was projected at N5.19 trillion for January to May.
“As of May, N1.49 trillion was realised out of the pro-rated sum of N2.16 trillion. This represents 69 per cent performance.
“Oil and gas deductions were N194.31 billion (or 45.8 per
cent) more than the budget.
“This is mainly attributable to petroleum subsidy costs
which was not provided for in the 2021 Budget.
“After netting out deductions (including 13 per cent
derivation) net oil and gas revenue inflows to the Federation Account amounted
to N872.16 billion.”
She noted that the inflow was N864.20 billion or 49.8 per
cent less than the projection as of May.
Giving an update on the revenue performance of 2021
budget implementation for January to May, Mrs Ahmed said the federal
government’s retained revenue was N1.84 trillion, 67 per cent of pro-rata target.
She said the share of oil revenues was N289.61 billion,
which represented 50 per cent performance.
She also added that non-oil tax revenues totalled N618.76
trillion, 99.7 per cent of pro-rata.
“Companies Income Tax (CIT) and VAT collections were
ahead of the budget targets with N290.90 billion and N123.85 billion,
representing 102 per cent and 125 per cent respectively of the pro-rata targets
for the period.
“Customs collections was N204.0 billion (86 per cent of
target).”
She said other revenues amounted to N762.70 billion, of which Independent revenues were N487.01 billion.
On the expenditure side, the minister said N4.86
trillion, representing 92.7 per cent of the prorated budget had been spent.
“This excludes GOEs’ and project-tied debt expenditures.”
She noted that of the expenditure, N1.80 trillion was for
debt service representing 37 per cent of federal government’s expenditure and
N1.50 trillion for personnel costs, including pensions, representing 31 per
cent of the federal government’s revenues.
The minister further said that as of May, N973.13 billion had been released for capital expenditure.
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