On December 14, 2016, President Muhammadu Buhari presented the 2017 Budget Proposal to a Joint Session of the National Assembly. Five months later, on May 11, 2017, the National Assembly passed the Budget (or Appropriation Bill), as it is formally known, into law, with changes.
Some of those changes were not acceptable to the Executive. For example the decision of the National Assembly to cut down the funding for a number of critical infrastructure projects, and to allocate that money to new projects introduced by the Assembly. What followed the passage were therefore four weeks of negotiations, regarding the restoration of full funding for those projects.
It took four weeks to come to an agreement, and, finally, on Monday June 12, 2017, six months after the President submitted the Budget, Acting President Yemi Osinbajo assented to it. The Appropriation Bill is now an Act of Parliament.
The good news is that the National Assembly has agreed to restore all of the affected funding, upon the submission of a request by the Executive, in a process known as ‘Virement’.
The 2017 budget is the first budget in Nigeria’s history prepared using a custom-developed software application for uploading and collating, instead of the conventional paper method that is prone to error and manipulation.
The new application allows users to track versions, and to see who is altering what. To support this, the Budget Office established a special HelpDesk to help guide Ministries, Departments and Agencies through the e-submission process.
We also continued with the Zero-Based Budgeting system we adopted and trialled for the first time with the 2016 budget.
The passed budget is N7.44 trillion, an increase of about N140 billion over the N7.298 trillion proposed by the Executive
The infrastructure component is 2.18 trillion Naira, which is about 30 percent of the total budget. (1.2 trillion Naira was spent on infrastructure in the 2016 budget — a record sum — of the roughly 1.8 trillion Naira budgeted for that purpose)
The 2017 budget signed into law by Acting President Osinbajo is based on the following assumptions: an oil price benchmark of US$44.50 per barrel (Executive originally proposed US$42.50), average crude oil production of 2.2 million barrels per day, and an exchange rate of N305/dollar
The 2017 budget prioritizes Roads and Railway Projects, Social Housing, Special Economic Zones, Social Investment Programmes, River Basin Development, Presidential Amnesty Programme, and development in the Niger Delta and North East.
Priority Road Projects in the budget include the following: The Second Niger Bridge, Lagos-Ibadan Expressway, Abuja-Abaji-Lokoja Road, Kano-Maiduguri Road, Enugu-Port Harcourt Road, Benin-Sagamu Road, and the Odukpani-Itu-Ikot Ekpene Road.
Priority Rail Projects in the budget include the Lagos-Kano Rail and the Lagos-Calabar Coastal Rail.
Other Things To Note
Budget signed into law by Acting President Yemi Osinbajo. Preparation of 2018 Budget has kicked off, to meet an October 2017 submission deadline to the National Assembly. The details of the budget will be presented to the public at 10am today Monday, June 19, 2017, by the Minister of Budget & National Planning, at the Rotunda Hall of the Ministry of Foreign Affairs.
The N-Power application portal opened for registration, for the next batch of beneficiaries. Registration will close on July 13, 2017. The first round of recruitment enrolled 200,000 beneficiaries; this second round will add another 300,000.
Flag-off by Acting President Osinbajo of the Federal Government’s Food Distribution Programme to IDPs and Host Communities in the Northeast, on June 8, 2017 (Details below)
Acting President Osinbajo declared open the Two-Day National Mining Summit at the International Conference Centre, Abuja, June 13-14, 2017.
18th meeting of the ECOWAS Assembly of Health Ministers Held at the ECOWAS Secretariat in Abuja, on Friday June 16, 2017.
16th Session of the African Ministerial Conference on the Environment (AMCEN) took place from 12-16 June in Libreville, Gabon. Theme: ‘Investing in Innovative Environmental Solutions to accelerate implementation of Sustainable Development Goals and Agenda 2063 in Africa’. Nigeria was represented by the Minister of State for Environment, Ibrahim Usman Jibril.
Minister of Health Prof Isaac Adewole launched the Tobacco-Free Nigeria Campaign in Abuja on Thursday June 15, 2017.
Flag-off of reconstruction of the 2km Apapa Wharf Road, on Saturday June 17, 2017, with the signing of an MoU between the Federal Ministry of Power, Works and Housing, and the joint sponsors of the reconstruction, Dangote Group, Flour Mills of Nigeria and the Nigerian Ports Authority (NPA).
Kaduna Dry Port Inspection Visit by Minister of Transport Rotimi Amaechi on Tuesday June 20, 2017
Apapa Port Complex will commence 24-hour operations this month, in compliance with a Presidential Order issued by Acting President Osinbajo in May 2017
June 2017 Update on our Homegrown School Feeding Programme, providing one hot meal per day to Public Primary School children across the country.
Worth knowing also
On May 23, the National Bureau of Statistics published Q1 2017 GDP figures. The economy shrank by 0.52%. While this means Nigeria continues to be in a recession, it is also clear that we are on the way out. In Q3 2016, the economy shrank by 2.34%. This fell to -1.3% in Q4 2016, and has further fallen to -0.52% in Q1 2017. Also, the number of sub-sectors of the economy that experienced negative growth has almost halved falling from 29 for the whole of 2016 to 16 sub-sectors in Q1 2017.
Agriculture and Solid Minerals, two of our priority sectors, continue to record solid growth, in spite of the recession. And manufacturing grew by 1.36% in Q1 2017, compared to a decline of 2.5% in Q4 2016 (and a decline of 7% in Q1 2016)
Headline inflation has dropped for the fourth consecutive month, to 16.25%. (The CBN target for 2017 is 11%).
Inflows of $2.2 billion through the CBN’s Special Forex Window for Investors and Exporters (NAFEX) since it was launched in April 2017. (Note that the CBN’s supply accounted for roughly 30 percent of that value)
The Nigerian Stock Exchange All Share Index and Market Capitalisation have each risen by roughly 25% since the beginning of 2017. The ASI hit a 24-month high in the 2nd week of June 2017. Much of that bounce is on account of the inflows into the new CBN Forex window. Foreign Portfolio Investors are showing renewed interest in Nigeria.
Rising crude oil production levels — now at the highest levels in 12 months, on account of resumption of operations at Forcados Terminal.
Foreign exchange reserves are now in excess of US$30 billion, compared to US$24 billion in October 2016
Increased capital spending by the Federal Government: 1.2 Trillion Naira in the 2016 budget. (The 2017 Budget will double that amount).