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Friday, February 23, 2024

Lawmakers greenlight N7.8 trillion borrowing plan as part of 2024-2026 fiscal strategy

House of Representatives Approves MTEF/FSP Amidst Debates Over Spending and Economic Indicators

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In a pivotal session on Tuesday, the House of Representatives gave its nod to the 2024–2026 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP), revealing a borrowing plan of N7.8 trillion for the fiscal year 2024.

Delving into the intricacies of the fiscal roadmap, the House established benchmark oil prices for the upcoming years at $73.96, $73.76, and $69.90 per barrel for 2024, 2025, and 2026, respectively. Concurrently, daily crude oil production targets were set at 1.78 Mbps, 1.80 Mbps, and 1.81 Mbps for the corresponding years.

Aligning with the executive’s proposal, the Green Chamber endorsed exchange rates of N700, N665.61, and N669.79 to $1 for the period 2024-2026, sparking debates on the economic feasibility of such projections.

In a bold display of economic foresight, lawmakers projected inflation rates of 21.40 percent, 20.30 percent, and 18.60 percent for 2024, 2025, and 2026, while concurrently proposing ambitious gross domestic product growth rates of 3.76 percent, 4.22 percent, and 4.78 percent, respectively.

The Federal Government’s financial plan for the upcoming years encompasses a recommended spending of N26 trillion, featuring N16.9 trillion in retained revenue and a N9 trillion budget deficit. The comprehensive breakdown includes N7.8 trillion in new borrowings, N1.3 trillion for statutory transfers, N8.2 trillion in debt service, and N1.27 trillion allocated for pension, gratuity, and retiree benefits.

As the MTEF/FSP clears parliamentary hurdles, concerns linger over the feasibility and impact of the proposed fiscal strategy on Nigeria’s economic landscape.

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