The Minister of Finance, Budget and National Planning, Zainab Ahmed, has explained that the Federal Government reviewed oil price and other key parameters in its projections for the 2022-2024 budgets to reflect present realities.
She disclosed this while presenting the draft 2022-2024 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) before the House of Representatives Committee on Finance on Monday.
She said Nigeria’s economy suffered in 2020 due to COVID-19 pandemic and other factors.
According to her, oil price benchmark was put at $57 per barrel for 2022 and 2023 while placed at $55 per barrel for 2024.
Oil production was put at 1.88 million barrels per day (mbd) for 2022, 2.23 mbd for 2023 and 2.22 mbd for 2024.
Exchange rate was placed at N410.15 to the Dollar for 2022, 2023 and 2024.
The minister, however, disclosed that, the parameters are subject to change depending on economic dynamics and other factors.
She further disclosed that Nigeria’s economy is still exposed to economic turbulence especially foreign exchange regime which was recently reviewed by the CBN.
According to her, there is still rising inflation, high employment rate which she said is expected to remain until the end of 2021.
In an opening remark, the Speaker, House of Representatives, Femi Gbajabiamila, who was represented by the House Leader, Alhassan Ado Doguwa said, it is not in the best interest of Nigeria to project, and then to make plans based on projections that are unlikely to come to fruition.
“We cannot make projections and commitments unless we are reasonably certain that we can achieve those projections and deliver on the commitments we have made,” he said.
On his part, Chairman of the committee, James Abiodun Faleke (APC, Lagos) said the 2022 budget estimates will be derived from the MTEF/FSP.
He said the MTEF/FSP comprises of government’s plan to accelerate economic recovery process, promote social inclusion and strengthen resilience of the economy.
“This has become necessary in the face of supply chain disruptions and heightened uncertainties occasioned by the COVID 19 pandemic, especially with the renewed wave of the prevalent Delta variant not only in our country but across the world.
“Nigeria like most developing countries is currently facing severe fiscal crises requiring serious fiscal discipline.
“It is no longer news that relying on oil as the only source of income is no longer feasible for effective sustainable development and budget implementation.
“The idea where the MDAs recycle unnecessary capital projects in the budget without due regards to essential projects that will engender sustainable development in the country is no longer tenable,” he said.