Buhari: 2020 Budget Of ‘Sustaining Growth and Job Creation’ Will Stimulate Private Sector Investment

President Muhammadu Buhari on Tuesday expressed optimism that the 2020 budget which he presented before a joint session of the National Assembly (NASS) will stimulate private sector investment and strengthen the country’s macroeconomic environment.

Buhari, who was accompanied to NASS complex by members of the Federal Executive Council (FEC), presented a budget of N10.729 trillion for the 2020 fiscal year.

The National Assembly had increased the 2020 budget from N10.002 trillion to N10.729.4 trillion after reviewing the 2020-2022 Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP) last week Thursday.

Speaking during the presentation, Buhari said the 2020 budget was designed to be a budget of “Fiscal consolidation to strengthen our macroeconomic environment; Investing in critical infrastructure, human capital development and enabling institutions, especially in key job creating sectors.’’

The president said the was meant for “Incentivising private sector investment essential to complement the government’s development plans, policies and programmes; and enhancing our social investment programmes to further deepen their impact on those marginalised and most vulnerable Nigerians.”

The proposed budget puts the federal government’s revenue in 2020 at N8.155trillion, comprising oil revenue of N2.64 trillion, non-oil tax revenues of N1.81 trillion and other revenue of N3.7trillion.

“This is seven per cent higher than the 2019 comparative estimate of N7.594 trillion inclusive of the Government Owned Enterprises,’’ he said.

According to Buhari, non-debt recurrent expenditure was pegged at N3.6 trillion for personnel and pension costs.

This is an increase of N620.28 compared to the figure in the 2019 budget.

“This increase reflects the new minimum wage as well as our proposals to improve remuneration and welfare of our police and armed forces,’’ he said.

President Buhari said “N2.46 trillion was earmarked for capital projects, inclusive of N318.06 billion in statutory transfers.”

Other estimates are N556.7 billion for statutory transfers; N2.45 trillion for debt servicing and provision of N296 billion as sinking fund.

He explained that the sinking fund would be used to “retire maturing bonds to local contractors”.

Meanwhile, the 2020 budget is based on an oil production estimate of 2.18 million barrels per day, oil price benchmark of 57 dollars  per barrel and an exchange rate of N305 to a dollar.

Other benchmarks are: real Gross Domestic Product (GDP), growth rate of 2.93 per cent while inflation rate “is expected to remain slightly above single digits in 2020’’

On sectoral allocations are: Works and Housing – N262 billion, Transportation – N123 billion, UBEC – N112 billion, Defence – N100 billion, Agriculture – N83 billion, Water Resources – N82 billion, Education – N48 billion, Health – N46 billion, North East Development Commission – N38 billion, SIPs – N30 billion, FCT – N28 billion, Niger Delta – N24 billion, Ministry of Interior – N35 billion as against N569 billion in the 2019 budget.

President Buhari added that, “This increase is largely due to favourable prices of crude oil in the international market, minimal disruption of crude oil production given the stable security in the Niger Delta region and our import substitution drive, especially in key commodities.’’