Country’s biggest ever spending plan it meant to wean it off oil, but lawmakers had held it up following glaring errors.
President Muhammadu Buhari finally signed Nigeria’s biggest ever budget ending months of haggling with lawmakers over spending plans to help stimulate an economy reeling from falling crude prices.
The presidency announced the signing on it’s Twitter page and didn’t immediately release the headline figure. Spokesmen weren’t answering calls to their mobiles.
With the spending plan at an expected 6.1 trillion naira ($30.6b), up 20% from the 2015 budget, Buhari is looking to diversify Africa’s largest economy and one of its biggest oil producers.
Significant portions of capital expenditure will go toward government’s plan to double electricity generation to 10,000 megawatts by 2019, and expand industrial production.
“The budget is meant to stimulate the economy,” Babajide Solanke, an analyst at Lagos-based FSDH Merchant Bank Ltd., said by phone before the document was signed into law. “The delay in passing it has been bad for the economy, and it might be difficult to achieve targets such as growing non-oil revenue.”
The international Monetary Fund said Nigeria’s economic growth could slump further to 2.3 % this year after dropping to 2.8% in 2015, the lowest rate since 1999.
Nigeria, which relied on crude for about 70% of government revenues and 90% of export earnings in 2014, has been hammered by a 60% plunge in oil prices since mid-2014 to about $45 a barrel.
Buhari first presented the budget in December to lawmakers, who rejected it citing discrepancies and glaring errors. They later approved a revised version, which Buhari said he would review to ensure it is in line with his administration’s original submissions.
The passing of the budget also means Nigeria can start borrowing to bridge this year’s fiscal gap. The government is already talking to the World Bank and African Development Bank for loans, and may raise as much as $1 billion from international capital markets, according to Finance Minister Kemi Adeosun.
FOLLOW NEW AFRICA BUSINESS NEWS ON FACEBOOK @ New Africa Business News.com