THE House of Representatives has passed the medium-term expenditure framework (MTEF) and fiscal strategy paper (FSP) for 2025-2027.
The approval followed the adoption of the Joint Committee on Finance and National Planning’s recommendations during plenary on Wednesday, November 27.
The ICIR reports that the MTEF outlines Nigeria’s fiscal policy objectives and macroeconomic projections for the next three years and provides a framework for annual budget preparations.
Key highlights of the adopted framework include an oil benchmark price of $75 per barrel for 2025, $76.2 per barrel for 2026 and $75.3 per barrel for 2027.
Domestic crude oil production was also projected at 2.06 million barrels per day for 2025, which is an increase from the current year’s 1.78 million barrels per day.
The framework also set GDP growth rates at 4.6 per cent in 2025, 4.4 per cent in 2026, and 5.5 per cent in 2027, while pegging the exchange rate at N1,400 to the US dollar for the three years.
The MTEF approval followed the Federal Executive Council’s recent adoption of the 2025-2027 framework, with a proposed N47.9 trillion budget for 2025, representing a 37.25 per cent increase from the 2024 budget.
The minister of budget and economic planning, Abubakar Bagudu, on Thursday, November 14, disclosed plans to finance part of the 2025 budget through N9.22 trillion in new borrowings to bridge deficits and fund key projects.
This borrowing, according to him, is projected to bridge the anticipated budget deficit and support key government programmes aimed at stabilising the economy.
Bagudu highlighted the government’s focus on maintaining progress in deregulating petroleum prices and exchange rates while aiming to cut production costs in the oil and gas sector.
“The budget size approved for presentation to the National Assembly in the MTEF is N47.9 trillion, with new borrowings of N9.22 trillion to finance the budget deficit in 2025. We aim to sustain the commendable market deregulation of petroleum prices and the exchange rate, compel the Nigerian National Petroleum Corporation Limited to significantly lower its oil and gas production costs, and potentially amend relevant sections of the Petroleum Industry Act 2021 to address key risks to the Federation,” Bagudu added.
The minister noted that a review of the 2024 budget implementation showed positive trends in revenue collection and expenditure management, particularly in non-oil revenue streams that had exceeded expectations.
“Despite some lags in prorated targets, the overall trajectory shows that fiscal efforts are on track, with key non-oil streams performing better than anticipated,” he stressed.
While the MTEF provides a roadmap for fiscal sustainability, concerns remain over Nigeria’s rising debt profile, with significant portions of the budget reliant on borrowing.
On January 1, Tinubu signed the N28.7 trillion 2024 appropriation bill into law.
The version of the bill passed by the Senate showed an increase of over N1.2 trillion from the N27.5 trillion proposal that the President laid before the joint sitting of the National Assembly on November 29.
Consequently, The ICIR reported that amid dwindling revenue resources and a huge debt servicing over Nigeria’s rising debt, Tinubu asked the National Assembly to increase the 2024 appropriation act by N6.2 trillion.
Usman Mustapha is a solution journalist with International Centre for Investigative Reporting. You can easily reach him via: umustapha@icirnigeria.com. He tweets @UsmanMustapha_M