The 2017 Budget Overview

This post is the first part of "The Fault in Nigeria's 2017 Budget" series. In this post, we will look at the entire 2017 budget at a glance. The 7.3 trillion naira budget was proposed based on the following benchmarks.
2017 Budget Benchmark (Credit:

The budget benchmark is highly optimistic. The price of crude oil is on the increase and is expected to remain  that way all through 2017 due to recent OPEC's resolution. However, the level of oil production is unlikely to remain at 2.2 million barrels/day largely due to the Niger delta militancy situation.

The inflation and GDP growth are way off the mark. Inflation as at december, 2016 was 18.6% and with recession biting hard, it is unlikely that inflation rate will reduce in 2017. Nigeria experienced negative GDP growth rate for 3 consecutive quarters in 2016. A GDP growth rate of 2.5 percent is highly optimistic.

Of the 7.3 trillion Naira proposed for 2017, about 2.24 trillion Naira representing 30.69 of the entire budget was earmaked for Capital expenditure while the rest goes into recurrent expenditure and debt servicing. The government expect to fund the budget from oil and non oil revenue as shown below
2017 Revenue Projection (credit:

From the Revenue projections above, the government expects a revenue of 4.94 trillion Naira in 2017 leaving a deficit of 2.36 trillion naira representing 32.34%. The government expects to finance this deficit from loans from both domestic and external sources.

2017 Borrowing Plan (credit:

The budget deficit (32.34%) is greater than the capital expenditure budget (30.69%). So, it wouldn't be wrong to say that the federal government is planning to borrow for capital expenditure in 2017.

So, there you have it. An overview of the proposed 2017 budget.