President Muhammed Buhari recently revealed a N6.08 trillion budget before a joint session of the National Assembly. While many believe the budget has the potential to put the nation’s economy on growth path over the next few months, there are prevalent mixed reactions from commentators.
Chief Executive Officer of Financial Derivatives Company Limited, Mr Rewane Bismark sees growth in the budget saying that deficit financing – requiring an additional N1.84trillion, is a bitter pill to swallow especially the reference to both domestic and more importantly, international borrowing.
Bismark said, “The most notable shift in his economic ideology remains the mute but tacit acceptance of the adoption of a flexible exchange rate- a no go area up to a few days ago.
“The budget is clearly consistent and is part of the 3-year Medium Term Expenditure Framework (MTEF). It seeks to stir Nigeria off the path of oil dependence.”
He affirmed that the budget hopes to achieve this through a focus on non-oil revenues by broadening the tax base and improving the effectiveness of Nigeria’s revenue collecting agencies.
He, however, stated that the renewed drive to boost non-oil revenues may not be sufficient to cover the gap from lower oil revenues.
According to Rewane, budget seeks to boost growth to 4.37per cent in 2016, adding that from a relatively static and dogmatic ideological position, Buhari has moved forward in the spectrum of economic reform, which is a welcome development for most economists and investors.