Budget 2016: Govt in search of N60bn for capital projects

Jolted by the outcry over slow implementation of the 2016 budget, Nigeria’s government is said to have intensified search for funds with which to executive a N5.72 trillion budget, of which N1.7 trillion is for capital project.

The budget, has been described by experts as the most sluggish in passage, having suffered a hold-up for months due to the bickering between President Muhammadu Buhari and the legislature.

It is also witnessing some implementation challenges as the oil revenue benchmark of $85 per barrel, the previous year , is now at all time low of less than $40 per barrel.

All efforts at sourcing funds to implement the deficit in the budget have not yielded results as the IMF and World Banks, in their submissions, said Nigeria could qualify for loan, only if it carried out some reforms, including official devaluation of the naira.

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But Buhari resisted this till late May when it allowed CBN to remove the official seal of N199 to dollar as exchange rate of the scarce dollar.

Other unforeseen issues, including Nigeria suffering a short fall in daily output from its estimated 2 .2 million barrels per day (bpd), losing about 700, 000 bpd, due mainly to the activities of the militant groups in the oil-rich Niger Delta region, have also contributed to the shortfall in reources.

In its desperate move to source funds, Nigeria turned its searchlight to China in an unpopular deal, which saw Buhari signing a $2 billion loan deal with which to finance the deficit in the budget, but without much progress made in releasing funds to critical sectors of the economy.

But Finance Minister Kemi Adeosun has said that efforts were in top gear aimed at jumpstarting the economy by releasing N60 billion ($180 million) for some capital projects, which is still anchored on promises, as similar sum of N150 billion has not been fully tied to projects.

Nigeria, Africa’s largest economy, she said, is in the middle of its worst financial crisis for decades as a slump in oil revenues hammers public finances and the naira without a clue on how to fight the resultant recession.

By Emma  Eke…

 

 

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