President Bola Tinubu’s Federal Government has proposed a budget of N47.9 trillion for the 2025 fiscal year, even as he wrote to the National Assembly, seeking for approval to take another $2.2 billion (about N1.77 trillion) external loan.
The 2025 budget represents a 35 percent increase from the 2024 total budget of N35.5 trillion.
The proposed budget breaks down into several key areas, including a non-debt recurrent expenditure of N9.92 trillion, capital expenditure of N7.72 trillion, debt service of N8.25 trillion, statutory transfer of N1.37 trillion, and a sinking fund of N243.66 billion.
The budget proposal projects a gross domestic product growth rate of 4.6%, crude oil price of $75 per barrel, exchange rate of N1400/dollar, and oil production of 2.06 million barrels per day.
Briefing newsmen shortly after approval of the proposal by the Federal Executive Council (FEC), presided over by President Tinubu in Abuja, the Minister of Budget and Economic Planning, Atiku Bagudu, said: “Key parameters for the 2025 to 2027 MTEF include an oil price benchmark of $75 per barrel for 2025, oil production set at 2.06 million barrels per day, and a projected exchange rate of 1,400 Naira to the US Dollar, as well as GDP growth target of 4.6% for 2025.
“For 2025, the federal government budget estimate is, is the aggregate expenditure is estimated at 47 trillion, and this includes a borrowing of 13 point 8 trillion, which is 3.87% of the estimated GDP and it includes projections, especially for the first time, provisions for contribution to the development commissions that have been passed by the National Assembly or are in the process of being passed by the National Assembly.
“Equally, the fiscal objectives were conservative because we want to ensure that we study the course much as we believe the projections will be exceeded.
“The budget size that was approved for presentation to the National Assembly in the mtef is 47 point 9 trillion, with new borrowings of 9.2 trillion to finance the budget deficit in 2025 as well as noting that we need to sustain the market deregulation, commendable market deregulation of petroleum prices and exchange rate.
“And to compel the Nigerian National Petroleum Corporation Limited to lower its oil and gas production cost significantly, and even to consider the need to amend the relevant sections of the Petroleum Industry Act 2021 to address the significant risk to Federation.”
Meanwhile, President Bola Tinubu has written to the National Assembly, seeking the approval of a fresh $2.2 billion as a new external borrowing plan in the 2024 Appropriation Act.
The President’s request was contained in a letter read by the Speaker of the House of Representatives, Tajudeen Abbas, during plenary today, November 19.
If approved, the loan will be used to part-finance the budget deficit of N9.7 trillion for the 2024 budget.
The President also forwarded the 2025- 2027 Medium-Term Expenditure Framework and the Fiscal Strategy Paper to the National Assembly for consideration and approval.
Tinubu also sent the National Social Investment Programme Establishment Amendment Bill to make the social register the primary tool for the implementation of the Federal Government’s social welfare programmes.
The letter read in part: “Request for the resolution of the National Assembly for the implementation of the new external borrowing of N1,767,102,179.00, that is about $2.209bn already enshrined in the 2024 Appropriation Act.
“In accordance with the provisions of Sections 21 and 27 Subsection 1, the Debt Management Office established Act 2003 and the approval of the Federal Executive Council, I write the request for a resolution of the National Assembly to raise the sum of $2.2 09bn.
“The new external borrowing enshrined in the 2024 Appropriations Act, part financed the budget to about $9.17 trillion.
“A Euro bond of about $1.7bn and Sukuk financing of another $500m the actual makeup of the financing.”
The second letter reads: “Please receive the 2025-2027 MTF and FSP approved during the Federal Executive Council meeting on the 10th day of November 2024.
“The Senate is invited to note that as the 2025 budget of the Federal Government of Nigeria will be prepared based on the parameters and fiscal assumptions of the approved 2025-2027 MTF and FSP, it is imperative to seek the National Assembly’s expeditious legislative action in this submission.
“I trust that the House of Representatives will consider the passage of this submission expeditiously.”
The Federal Executive Council approved the $2.2bn external borrowing plan last Thursday.
