The Federal Executive Council (FEC) has approved the major assumptions that will guide Nigeria’s 2021 national budget.
Among the approved figures are a crude oil benchmark price of $40 per barrel and an exchange rate projection of N379 to the dollar.
These parameters were confirmed by Presidential aide Tolu Ogunlesi, who disclosed the outcome of the FEC meeting held on Wednesday, September 30, 2020.
Revenue and Spending Performance So Far
The Ministry of Finance reported that revenue performance for the first half of 2020 stood at 68%, while 92.3% of government expenditure during the same period was channeled towards salaries, pensions, statutory transfers, and debt servicing.
COVID-19 and the Revised 2020 Budget
Due to the economic downturn caused by the COVID-19 pandemic, the Federal Government earlier revised the 2020 budget.
The oil benchmark was slashed from $57 to $25 per barrel, and daily production forecasts were reduced from 2.18 million barrels to 1.94 million barrels per day.
These changes were disclosed by the Minister of Finance, Zainab Ahmed, at the time.
Breakdown of 2021 Budget Projections
The latest 2021 budget framework approved by FEC includes the following highlights:
- Oil Benchmark: $40 per barrel
- Daily Oil Production: 1.86 million barrels (including 400,000 barrels of condensate)
- Exchange Rate (FX): N379 to $1
- GDP Growth Target: 3%
- Inflation Rate Target: 11.95%
- Total Expenditure: N13.08 trillion
- Capital Expenditure (CapEx): 29% of total spending
- Budget Deficit: N4.48 trillion
Budget Presentation to National Assembly
The Ministry of Finance has confirmed that the 2021 budget will be formally presented to the National Assembly in October.
The FX benchmark has been adjusted from N360/$ to N379/$ to reflect updated macroeconomic conditions.
