The federal government of Nigeria has recorded a revenue shortfall of N1.064 trillion in the first six months of the year, the Minister of Budget and National Planning, Senator Udoma Udo Udoma, disclosed on yesterday.
The disclosure came as consultations for the 2017-2019 Medium Term Expenditure Framework(MTEF) and Fiscal Strategy Paper (FSP) commenced in Abuja.The total revenue inflow, Udoma said, was short of the budget projection by N 1, 064.91 billion or 55.2 per cent as at June 2016. According to him, the shortfall was augmented by domestic borrowing amounting to N 600 billion, about 33 per cent of the approved borrowing of N 1, 818.87 billion.
He attributed the negative revenue situation on falling oil revenue and attacks on oil and gas installations in the Niger Delta region.
“The 2016 budget performance is reflective of the low revenue out turns attributable to the global and domestic developments earlier highlighted.
“Oil revenues fell significantly in the second quarter compared to the first quarter as a result of increased oil pipeline vandalism and production shut-ins.
“Non – oil revenues also declined compared with forecasts in the budget due to slow- down in economic activities and the acute shortage of foreign exchange,” Udoma said.
Giving an insight into the current expenditure situation for the year, he disclosed that N2.123 trillion had been spent by the federal government
Total capital expenditure as at the end of June, according to the minister, stood at N331.58 billion, while personnel cost had been fully met.
He put personnel cost at N891.31 billion even as he stated that debt service gulped N598.63 billion while statutory transfers was N175.68 billion.
On overhead, Udoma disclosed that the figure was N125.4 billion just as pension and gratuity got N79. 18 billion.
“Government’s focus is to ensure quality of expenditure. Capital releases are based on priorities. MDAs’s performance, as well as, value-addition to the immediate needs of the economy,” the minister said about the administration’s policy on capital expenditure.
On plans for revenue projections in the coming years, the minister said the administration was considering a conservative oil price benchmark of $42.5 barrels per day (bpd) for 2017, $45 bpd in 2018 and $50 bpd in 2019.
The minister disclosed that the government was also expecting an oil production of 2.2 million, 2.3 million and 2.4 million barrels per day, in 2017, 2018, and 2019, respectively.
Similarly, he said on the Gross Domestic Product (GDP) that the government was projecting a gradual recovery after the slowdown, adding that a very marginal positive growth of 0.35 per cent was being expected in 2016 ,with a projection of increase in that direction to 4.4 per cent in 2019.
According to him, this was with an average of 3.77 per cent average within the period of the MTEF.
“GDP growth is expected to be largely driven by the non-oil sector with agriculture including agro-business, solid minerals, as well as, building and housing playing a lead role . Export-led growth is to be pursued,” Sen. Udoma said.
Meanwhile erstwhile business magnate Aliko Dangote is no more in the list of 100 richest men as reported by Bloomberg. Following the crash of the naira, Aliko Dangote, president of Dangote group, has dropped off the list of the 100 richest people in the world.
Dangote was the 51st richest man in the world as at March 2016 , but he had dropped to 101 as at the start of business on yesterday.
Dangote, who owns the second largest sugar-refinery in the world, remains richer than Donald Trump, American billionaire presidential candidate, and Oprah Winfrey, US TV personality, who dubs as the second richest black woman in the world. Dangote is now worth $11.1 billion, while Trump and Oprah are estimated at $4.5 billion and $3.1 billion, respectively.
The fall in the naira, as against the dollar, from about 198 to about 300, has eroded about a quarter of Dangote’s wealth, as he commits to investing heavily in Africa’s largest economy, Nigeria.
At the launch of the new foreign exchange regime on June 23, 2016, Dangote fell from 46 on the world billionaire list to 71, and has continued in that manner with the naira plunge.
According to Bloomberg billionaires, Dangote, who was worth $15.4 billion (N3.05 trillion) in March, is now worth $11.1 billion (N3.3 trillion) —richer in naira, but poorer in dollars.
The launch of Dangote refinery, the biggest greenfield refinery in the world, billed for 2018/2019 is expected to propel him into top 20 by 2019.
Dangote Cement, one of Dangote’s major investments in Nigeria, is the biggest company on the Nigerian Stock Exchange, by market capitalisation, and the biggest cement producer in sub-saharan Africa.
The company however missed out of the 100 biggest companies in the world, according to Fortune 500.
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