FG to Achieve N24.54trn Revenue Inflow into Federation account 2024
Revenue accruals to Federation Account is projected to rise to N24.54 trillion in 2024 from N11.86 projected in 2023.
Of this figure, revenue from the main pool is projected to be N20.70 trillion while Value Added Tax ( VAT) pool and Electronic Money Transfer Levy ( EMTL) are projected at N3.66 trillion, N174.26 billion respectively.
Director General of Budget Office of the Federation, Mr. Ben Akabueze, said this at the ongoing Nigeria Economic Summit in Abuja.
Giving insights into the on the 2024-2026 Medium Term Framework and Fiscal Strategy document, Akabueze said the draft 2024-2026 paper was prepared against the backdrop of domocratic transition to reflect current realities and new direction of the President Tinubu administration in addressing key policy and fiscal challenges.
The document showed key parameters to drive the medium-term revenue and expenditure framework for Nigeria in 2014 include: Oil benchmark:2024- $73.96; 2025- $73.76; 2026- $69.90. Oil Production (Mbps): 1.78; 1.80; 1.81. Exchange rate N/$: 700/$; 665.61/$; 669.79/$. Inflation: 21.40 per cent20.30per cent; 18.60
Other parameters are: Non-oil GDP: Non-Oil GDP (N’bn): N223,989.2; N249,188.0; N278,251.7. Oil GDP (N’bn): in 2024-N12,316.0; 2025- N13,225.7; 2026-N14,272.0. Nominal GDP (N’bn): N236,305.2; N262,413.7; N292,523.7. GDP Growth Rate (%): 3.76; 4.22; 4.78. Imports: 32,453.5; 33,401.3; 34,515.4 and Nominal Consumption (N’bn): N163,227.8; N189,992.8; N218,594.2
The projected exchange rates for the Nigerian Naira (N) against the U.S. Dollar ($) are 700 Naira to 1 Dollar in 2024, 665.61 Naira to 1 Dollar in 2025, and 669.79 Naira to 1 Dollar in 2026. These rates reflect the assumed values used for currency conversion in economic calculations.
The oil benchmark reflects the expected price of oil in the years 2024, 2025, and 2026, which increases slightly in 2025 before decreasing in 2026. Oil production is expected to increase slightly over the three-year period.
The exchange rate is expected to fluctuate, decreasing significantly in 2025 before increasing slightly in 2026 while inflation is expected to decrease over the three-year period.
Non-oil GDP is expected to increase steadily, while oil GDP is expected to increase slightly. Nominal GDP which represent the estimated total value of goods and services consumed in the Nigerian economy is expected to increase steadily, with a growth rate of around 4% each year. Imports which are the estimated total value of goods and services imported into Nigeria are expected to increase over the three-year period, while nominal consumption which represents the estimated total value of goods and services consumed in the Nigerian economy is expected to increase steadily.
These figures indicate that Nigeria’s economy is expected to maintain steady growth over the next few years, with some fluctuations in key parameters such as the exchange rate and oil benchmark. However, there may be continued challenges with inflation and a heavy reliance on oil as a primary source of revenue.
“Accordingly, economic growth is projected to increase to 3.76 per cent, 4.22per cent and 4.78 per centin 2024, 2025 and 2026, respectively, mainly due to strong political will to take tough decisions and implement necessary reforms.
The document added that “most of the growth in real GDP during the period will be driven by the anticipated increase in domestic oil refining capacity, telecommunications, crop production, slight growth in investment and employment, with the bulk of projected growth coming from the non-oil sector.
It noted that “the Renewed Hope Agenda (RHA) of the Tinubu Administration has significantly higher growth targets than the National Development Plan (NDP) 2021-25. The NDP is therefore undergoing a review to align its growth aspirations with the RHA”.
Consumption in nominal terms is projected to increase to N163.23 trillion in 2024 and N218.59 trillion in 2026 substantially due to expected increase in wages and cash transfers to households to mitigate the negative impact on their real income of petrol subsidy removal.
Import of goods is projected to increase to N32.45 trillion in 2024 and gradually to N34.51 billion in 2026 due mainly to the effects of depreciation of the domestic currency and imported inflation.
“Inflationary pressure is projected to continue at 21.4% in 2024. A slight reduction in inflation pressure is anticipated from 2025 and 2026 due to the lag effect of tight monetary policy on demand for goods and services, expected lower deficit financing and reduction in supply-side constraints occasioned by a drastic reduction in domestic insecurity, improved infrastructure, and generally better operating environment for businesses”.
