Budget: LNG, Local And Foreign Borrowing, Targeted For Funding |The Source

By Uche Mbah

N208.5 billion dividends from Nigeria Liquefied Natural Gas, NLNG is being targeted by the President Muhammadu Buhari Administration to fund the 2021 budget, which was estimated at N13.08 trillion.

The President, Thursday, presented the Budget to the National Assembly for debate and approval. The National Assembly has been making serious attempts to reverse the budget year to January to December.

President Buhari said  he is anticipating a total of N7.88 trillion revenue and plans to raise N5.19 trillion through borrowing and other sources.

Out of this, the Government plans to borrow N4.28 trillion to fund the deficits.

Part of this is the expectation of the new major revenue source, natural gas. N208.54 is targeted by the government on investment in this source. This is besides the earnings from signature bonuses from oil blocks sales and renewal of licenses from upstream operators. This is expected to yield N677.01 billion towards the funding of the appropriation bill.

Other sources of income the government is relying on for the financing of the budget include N32.67 billion recoveries from looted funds, assets, taxation, and fines and fines and expected revenue of N500 billion through Stamp Duty collection in the course of the year. Then foreign aids and grants are expected to yield N354.85 trillion within the year.

Government, however, plans to spend on debt servicing a whooping N3.34 trillion. This amounts to about 24% of the total budget. Out of this, N94 billion goes to service foreign loans and N2.18 trillion on borrowing from the domestic debt market and N220 Billion used for the retiring of maturing loans.

Nigeria owes China, the European Union, and the USA, Trillions of Naira, and the debt servicing appears to be crippling the economy.

However, the Presidency is still applying to borrow more from Brenton Woods Institutions.

Early in the week, a former Vice Presidential candidate under the PDP, Peter Obi, had advised the Federal Government against borrowing for consumption.

Speaking at the 60th founders day celebration at the university of Nigeria, Nsukka, where he is an alumnus, Obi said government should look to borrow ideas from China, not money.