Nigeria’s Senate passes 2018 budget on $45 per barrel at an exchange rate of N305/$

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ABUJA, May 16 – Nigeria’s upper house of parliament passed a record 9.12 trillion naira ($29.8 billion) budget for 2018 on Wednesday aimed at boosting growth in west Africa’s biggest economy nine months before the country’s next presidential election.

Growth remains fragile after Africa’s top crude oil producer last year emerged from its first recession in 25 years. The recession was largely caused by low crude prices and militant attacks on energy facilities since oil sales make up two-thirds of government revenue.

The total sum laid out in the spending plan passed by the Senate is higher than the 8.6 trillion naira budget presented to parliament by President Muhammadu Buhari in November. The budget still needs to be returned to Buhari to be signed into law.

Lawmakers said the increase was due to the assumed oil price rising to $51 per barrel, up from $45 in Buhari’s earlier version. The budget assumes crude oil production of 2.3 million barrels per day and an exchange rate of 305 naira per dollar.

The Senate has passed the 2018 Budget of N9.21 Trillion following the consideration and adoption of the Budget report laid on the floor of the upper legislative chamber on Tuesday.

He said at the session that with a benchmark of 45 dollars per barrel at an exchange rate of N305 to a dollar in 2018, the budget would consolidate on the achievements of previous budgets to aggressively steer the economy to the path of steady growth.

This is coming 6 months afterthe budget document was presented to a joint session of the National Assembly in November.

The Budget document passed on the floor of the senate is similar to what is being considered by the house of representatives and it shows and increase of N508 billion to take it to N9,120, 334,988,225 from the N8.6 trillion presented by Buhari.

The Senate and House of Representatives had promised to pass the budget on April 24, but failed to do so.

There were equally assurances that the budget would be passed in the first week of May but it was not passed.

The Senate had on several occasions accused Ministries, Departments and Agencies (MDAs) of not keeping to appointments with the various standing committees to defend their budgets.

Subsequently, the President of the Senate, Dr Bukola Saraki, on April 12, mandated the Appropriation Committee to tidy up reports on the budget latest by April 13.

With this development, the January to December budget cycle would not be obtainable with the 2018 budget.

Buhari had on Nov. 7, 2017 presented a budget of N8.6 trillion before a joint session of the National Assembly.

The president who announced the 2018 budget as “Budget of Consolidation”, said the projected expenditure would drive rapid economic recovery.

Budgets under Buhari, who took office in May 2015, have been Nigeria’s largest ever. But economists say implementation has been poor and failed to provide the type of capital expenditure needed to improve infrastructure and diversify the economy away from its reliance on crude oil sales.