Nigeria’s 2024 Budget Unveils Significant Reduction in Deficit Projection
President Tinubu has presented the 2024 appropriation bill to the National Assembly, revealing a noteworthy development in the budget deficit projection.
The federal government anticipates a substantial decline of N4.60 trillion in the deficit for the upcoming fiscal year, marking a significant 33.5% reduction compared to the 2023 budget.
In the proposed 2024 budget, the deficit is estimated at N9.18 trillion, showcasing a notable decrease from the N13.78 trillion deficit recorded in the 2023 budget.
This reduction reflects the government’s commitment to fiscal responsibility and debt management.
President Tinubu highlighted the deficit-to-GDP ratio, indicating a 2.22% reduction in the 2024 budget compared to the 2023 budget.
The deficit-to-GDP ratio for 2024 stands at 3.88%, down from the 6.11% recorded in the 2023 budget.
Addressing the funding sources for the budget deficit, President Tinubu outlined a strategic approach.
The deficit is set to be financed through new borrowings totaling 7.83 trillion naira, revenue from privatization proceeds amounting to 298.49 billion naira, and a drawdown of 1.05 trillion naira from multilateral and bilateral loans designated for specific development projects.
The President’s budget proposal, totaling N27.5 trillion for 2024, reflects an optimistic economic outlook.
President Tinubu expects the economy to grow by 3.76%, surpassing the forecasted world average. Additionally, there is an anticipation of inflation moderating to 21.4% in 2024.
It’s worth noting that President Tinubu has already sought approval from the National Assembly for external borrowings as part of the 2022-2024 external borrowing plan.
The request includes approval for $8.69 billion and €100 in external loans, aligning with the government’s strategy to secure necessary funds for critical developmental projects.
The reduced budget deficit projection signals a prudent fiscal approach, balancing the need for economic growth with responsible debt management.
As the budget proposal undergoes legislative review, it sets the stage for a comprehensive examination of Nigeria’s financial priorities in the coming fiscal year.
Source: Nairametrics
