There are strong indications that Nigeria’s economy is heading for another round of recession with deficit financing of revised N10 .509 trillion 2020 budget rising from N1.847 trillion to N4.563trillion .
This was made known on Monday during budget defence sessions held by the Senate Committee on Finance with heads of the Country’s revenues generating agencies on the revised 2020-2022 Medium Term Expenditure Framework ( MTEF) and Fiscal Strategy Paper ( FSP) .
In separate presentations made by heads of the revenue generating agencies led by the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, earlier targeted revenues from all the relevant agencies have been drastically slashed in the new proposals.
Besides, 77% of the newly proposed revenues from the various sources like the Nigerian National Petroleum Corporation (NNPC), Federal Inland Revenue Service (FIRS), Nigerian Customs Service ( NCS), is for debt serving.
The Minister of Finance in her response to a question on the likelihood of recession said : “Very clearly the Gross Domestic Product (GDP ) has been reduced because of the economic crisis that we found ourselves in but Nigeria is not alone in this.
“The global economy is predicted to be also slipping into recession. What we are hoping to do by our own collective efforts the executive and the National Assembly is that we minimize how far we go into recession.
“National Bureau of Statistics(NBS), has made an assessment that we will go into recession to the level of 4%.
The slashed projected revenues for the various agencies are the N1.5trillion earlier proposed for Nigeria Customs Service , reduced to N950billion , N463billion earlier projected as stamp duty revenues for FIRS now reduced to N200billion , N1.222trillion earlier projected for NNPC’s federally funded projects now reduced to N484billion .
But the Chairman of the Committee, Solomon Adeola, in his remarks after the session said some of the new proposals may not be adopted as requested .
According to him, “Having listened with rapt attention to all presentations made by the Minister for Budget and National Planning and the questions asked regarding the MTEF and FSP, I believed that members of the Committee are satisfied with reasons being offered by the minister on why we have to go this direction at this point in time.