Toba Owojaiye reporting
President Bola Ahmed Tinubu’s ambitious 2024 budget proposal, totaling N27.5 trillion, has undergone thorough scrutiny by economists and financial analysts. The substantial increase of N2.7 trillion from the 2023 budget has sparked a mix of optimism and concerns among experts.
Truth Live News reports that the proposed budget relied on various assumptions, including a N750 per dollar exchange rate, $77.96 per barrel oil benchmark, 1.78 million barrels per day oil production volume, 3.76% GDP growth rate, and a 21.4% inflation rate.
While acknowledging the ambition, experts express concerns about potential challenges in implementation, citing the need for the government to address the rising debt profile, inflation at 27.6%, and the foreign exchange rate at N831.47/$.
A significant allocation of N8.7 trillion to security in capital projects is noteworthy, but experts stress the importance of addressing economic challenges. The Lagos Chamber of Commerce and Industry (LCCI) highlights that, relative to Nigeria’s GDP size, the proposed budget represents only 12.2%, considerably lower than African peers.
Professor Adeola Adenikinju of the University of Ibadan sees the budget as not overly ambitious but emphasizes commitment and dedication for successful implementation. He suggested monitoring and contingency plans for unpredictable variables like oil prices. Funding the budget requires blocking leakages, reducing governance costs, and collaboration between monetary and fiscal sides.
Professor Mufutau Ijaiya, a finance expert, proposed exploring the service sector and non-oil products for revenue generation to address concerns about the deficit.
Analysts stressed judicious use of loans for capital projects rather than recurrent expenditure. The LCCI calls for improved budget performance, particularly in capital expenditure, and advocates for investment in transport infrastructure to build investor confidence.
Experts collectively emphasized the importance of efficient implementation, addressing economic challenges, and boosting investor confidence to ensure the success of the 2024 budget. The call for collaboration between the public and private sectors, revenue generation, and prudent expenditure underscores the complexity of the task ahead for President Tinubu’s administration.