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FG: We couldn’t have presented N27trn budget estimate without economic reforms

FG: We couldn’t have presented N27trn budget estimate without economic reforms
December 08
15:07 2023

The federal government has attributed economic reforms to its ability to present a record N27 trillion budget proposal.

Atiku Bagudu, minister of budget and national planning, said this on Friday when he appeared before the house of representatives committee on appropriations to elucidate on the 2024 budget proposal.

Last month, President Bola Tinubu presented the 2024 budget estimate to a joint session of the national assembly. 

The appropriation bill has passed first and second readings at both chambers of parliament.

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Ministries, departments and agencies (MDAs) are now taking turns to appear before the relevant committees of the national assembly to defend their budget  proposals.

Speaking on Friday, Bagudu attributed the ability of the federal government to propose the N27 trillion budget to petrol subsidy removal and liberalisation of the foreign exchange market.

In May when he was sworn in as president, Tinubu announced an end to the petrol subsidy regime. A month later, the Central Bank of Nigeria (CBN) unified all segments of the foreign exchange (FX) market.

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Bagudu said the president is “bold and ambitious” and has been very clear in his communication that as a country, Nigeria is not where it should be.

The minister said Nigeria’s N27 trillion budget proposal is “small” when juxtaposed with those of other populous nations. 

“Of the 10 most populous countries in the world, we have the smallest budget,” he said.

“Mexico with 120 million people has about $314 billion annual budget. Brazil which follows us in population ranking has about $700 billion federal budget.

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“The only country that we are close to is Pakistan which is not resources endowed as us. But even in Pakistan, their federal budget for 2024 is $45 billion. In dollar terms, even at the N750 exchange rate, we are about $35 billion.

“We have a N27 trillion budget but it is important. That budget came about because of the good choices that we made.

“On day one, Mr. President said we are done with fuel subsidy and that has helped (us) — equally, the foreign exchange that has been liberalised. That is why we are even able to present N27 trillion budget otherwise we wouldn’t.”

The minister said in the budget, N65 billion is proposed to support the expansion of mortgages so that the housing sector which many countries have used to boost economic activities, can also grow.

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He said Nigeria’s proportion of the global GDP is about 10 percent and Tinubu has directed that it should be raised to 18 percent.

“Mr. President has expressed the directive that we must raise it to at least 18 percent. 18 percent is big but it’s still lower than the global average,” he added. 

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Bagudu also defended the president’s foreign trips, saying Nigeria needs to woo investors.

“Some people see travel expenses as an issue, they don’t know that it is something that is required,” he said.

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“We don’t have money, we are looking for money. We need to engage with investors.”

The minister added that laws that limit investors must be examined and repealed.

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