The Federal Government is proposing a budget with estimates totalling N19.76tn, while the deficit will hover between N11.30tn and N12.41tn in the 2023 fiscal year.
If the deficit settles at N12.41tn in 2023, the Federal Government may need to borrow to finance it, which could raise Nigeria’s total debt to a record N54.01tn.
Nigeria’s current debt is N41.6tn, according to the 2022 first quarter data from the Debt Management Office.
The debt will likely exceed the three per cent limit prescribed in the Fiscal Responsibility Act, which was earlier overshot by the current administration in 2020.
The Minister of Finance, Budget and National Planning, Zainab Ahmed, said in Abuja on Monday, that the government might be unable to provide for treasury-funded capital projects next year, especially due to dwindling revenue and payment of subsidy on Premium Motor Spirit popularly known as petrol.
Ahmed, in his presentation to the House of Representatives’ Committee on Finance at the hearing on the proposed 2023-2025 Medium Term Expenditure Framework and Fiscal Strategy Paper, expressed concern that crude oil production challenges and the petrol subsidy deductions by the Nigerian National Petroleum Company Limited (formerly Nigerian National Petroleum Corporation) constituted a major threat to the country’s revenue growth targets.
The minister added that the country must do things differently to get results.