The Nigerian government under President Muhammadu Buhari has found itself on a financial cliff due to the disparity between revenue generation and expenditure caused by dwindling oil revenue. Oil revenue has declined in recent years while expenditure has been growing at a geometric progression, and the government appears to see borrowing as the only means to block the widening fiscal deficit.
“Over time, we have resorted to borrowing to finance our fiscal gaps,” Mr Buhari said in his budget presentation speech last month, before explaining how the government plans to finance the huge deficit in the proposed 2023 budget.
“We plan to finance the deficit mainly by new borrowings totalling 8.80 trillion Naira, 206.18 billion Naira from privatisation proceeds and 1.77 trillion Naira drawdowns on bilateral/multilateral loans.”
However, federal lawmakers are proposing a drastic measure to help the country out of the fiscal hole by placing eight revenue-generating…
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