The Joint Committee on Finance’s chairman, Sen. Sani Musa, gave a presentation today, following which the Senate approved the Medium-Term Economic Framework (MTEF) and Fiscal Strategy Paper (FSP) for 2024–2024.
Numerous suggestions were agreed by the Senate, including setting the inflation rate at 21.4% in 2024, 20.3% in 2025, and 18.6% in 2026.
The National Bureau of Statistics reports that October’s inflation rate is 27.33%. Nigeria’s inflation rate is expected to exceed 30% in December, according to KPMG, despite the federal government’s expectation that it will decline in 2024.
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Other decisions reached include the following:
Crude Oil Production: 1.78 million barrels per day
Crude Oil Price: $73.6 per barrel
Exchange Rate: N700 to the dollar
GDP Growth Rate: 3.76%
Budget Projection for 2024: N26 trillion
Projected Revenue for 2024: N16.9 trillion
Approved Deficit for 2024: N9 trillion
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Debate on exchange rate
During the seating, there was a contentious debate on the exchange rate of N700/$ pegged for 2024 as senators queried the feasibility of the proposal.
The senate also resolved to ban the importation of all items locally produced as a measure to shore up the value of the naira.
The Senate also moved to amend the act of the Bureau of Public Enterprise (BPE) and mandate the Ministry of Finance to take charge of all assets of the federal government both fiscal and material.
The Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) guides the federal government’s spending with its economic and social objectives.
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It constitutes a three-year rolling plan that outlines the government’s spending priorities and the corresponding funding mechanisms.
The approval of the MTEF by both chambers of Nigeria’s parliament clears the path for President Bola Tinubu to submit the country’s 2024 budget proposal of 26 trillion naira ($34 billion) to parliament for consideration.
The document, endorsed by Tinubu’s cabinet before its submission to lawmakers for approval, anticipates the naira currency to trade at around 700 per dollar in the coming year, with a slight strengthening projected for 2025 and 2026.
