The Federal Government is to introduce new expenditure not earlier budgeted for in the 2020 budget to adequately respond to #COVID-19 pandemic.
This is consequent upon the Federal Executive Council approving the review of the 2020 budget and the Medium Term Expenditure Framework for 2020-2022 as recommended by the ministry of finance.
The reviewed budget has new benchmarks which now includes $25 per oil barrel, and a target production rate of 1.94 million barrels per day and then an exchange rate of N360 to $1.
The minister of finance Zainab Ahmed made this revelation while briefing State House correspondents on Wednesday.
Ms Ahmed said the revised budget now amounts to N10.5 trillion, a difference of about N71.5 billion when compared to the initial approved budget.
“This is because, as we cut down the size of the budget, we also have to bring in new expenditure previously not budgeted, to enable us adequately respond to the #COVID-19 pandemic,” she noted.
Ms Ahmed said while the federal government will fund the budget by N5.158 trillion, the deficit from N5.365 trillion will be financed by both domestic and foreign borrowing.
Recall that both the Senate and House of Representatives have approved the borrowing plan of N850 billion by the federal government.
According to the minister, the plan was to borrow from foreign sources for 2020 and are all concessionary loans from the IMF which has already been approved and has crystallised, from the World Bank, Islamic Development as well as Afro EXZIM bank.
“The borrowing, the multilateral loans draw-down coming from special accounts and coming from the privatisation will fund the fiscal deficit of N5.365 trillion that we have in the proposed amendment of the 2020 budget,” Ahmed said.
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