The Federal Executive Council has approved revised Nigeria 2020 budget cutting it from N10.59 trillion to N10.523 trillion, a difference of about N71.5billion.
This was disclosed by the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, while briefing State House correspondents at the end of the Federal Executive Council, (FEC) meeting presided over by President Muhammadu Buhari at the Council Chamber, Presidential Villa, Abuja.
The minister said, that there will be a cut of 20% from the capital expenditure of the 2020 budget while recurrent expenditure will be reduced by as much as 25%.
The revised budget pegged oil price at US$25 per barrel, while Nigeria’s crude oil production quota was fixed at 1.94million barrels per day.
Recall that the Minister of Finance, Zainab Ahmed said that the revision will be based on declining international oil prices and the impact of the Coronavirus pandemic. She had also hinted that the federal government will drop the oil benchmark from the initial $57 per barrel to $25.
FEC also approved the amendment of the Medium Term Expenditure Framework of 2020 to 2022 with the same parameters.
The Finance Minister explained that there would be a deficit of N5.365 trillion in the amended budget, which would be financed by both domestic and foreign borrowing.
The foreign borrowing for 2020 are all concessionary loans from the IMF, which had already progressed, approved and crystallized; from the World Bank, from the Islamic Development Bank as well as from AFREXIM Bank.
Multi-lateral loans draw down, funding from special accounts and funding from privatization will fund the fiscal deficit of N5.365 trillion that we have in the proposed amendment for the 2020 Budget.
Mrs. Ahmed said that the Economic Sustainability Committee, chaired by Vice President Yemi Osinbajo was working to develop a 12-month economic sustainability plan that will prioritize made-in-Nigeria products to boost the Nigerian economy and to save foreign exchange.