The Framework seems to consider current realities with a view to achieving macroeconomic stability.
The Medium Term Expenditure Framework (MTEF or “the Framework”) highlights the FG’s envisioned policies that will restructure Nigeria from recession to a path of sustainable growth over the next three years. The Framework seems to consider current realities with a view to achieving macroeconomic stability.
The key assumptions underlying the MTEF are as follows:
|Items||2017 FY||2018 FY||2019 FY|
|Benchmark oil price (US$ per barrel)||42.5||45||50|
|Oil production volume (Mbpd)||2.2||2.3||2.4|
|Average exchange rate ($1:₦)||305||305||305|
|Average inflation rate (Percentage)||15.74||11.88||12.57|
|GDP growth rate (Percentage)||2.5||4.26||4.04|
To achieve the above projections, the FG proposes the following objectives:
i. Enabling business environment to boost investors’ confidence. This would happen by lowering cost of business and improving living conditions of Nigerians.
ii. Continued adoption of the zero-based budgeting (ZBB) system introduced in 2016. This will ensure that only projects and programmes, which align with the FG’s economic priorities, are executed.
iii. Evaluation and strengthening of frameworks for concessions and public-private partnerships (PPPs) for the purpose of bridging the country’s infrastructure gap. This is classified as one of the FG’s priorities as the Government cannot finance infrastructural investment alone. The PPP will focus on key projects (such as railway construction and power generation) in order to create an enabling environment for business in Nigeria.
iv. Reform in the oil and gas sector. This will include creating a competitive business environment for enhanced exploration and exploitation of petroleum resources, promoting local content, protecting health and environment, and increasing gas production.
v. Improved revenue mobilisation from non-oil sector.
vi. Continuation of the public finance management reforms to enhance accountability and transparency. To achieve these objectives, projects such as the operation of the Integrated Personnel and Payroll Information System, compliance with the International Public Sector Accounting Standards, and continuous audit of government expenditure are to be rigorously pursued.
vii. Diversification of the economy. The focus will be on the small and medium enterprises in the mining and agricultural sectors.
viii. Sustainable debt management which remains within the statutory threshold of 3 percent of GDP as stipulated by the Fiscal Responsibility Act, 2007.
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