Nigeria has borrowed 473 billion naira in the first four months to fund its 2015 budget, which was approved by the parliament last month, finance minister, Ngozi Okonjo-Iweala said at a press briefing on Tuesday.
The Senate had last week approved 4.493 trillion naira budget, while the house of representatives had earlier approved 4.42 trillion naira, 51 billion naira more than the senate's approval.
The budget was presented to both chamber of the parliament about five months ago by Okonjo-Iweala.
The minister finance minister said in spite of the none approval of the budget by the parliament and signed by the president, the constitution allowed the government sustain its business within a certain limit in the first six months of the year.
She noted that the fall in global oil price since last year had continued to impact negatively on government revenue.
Okonjo-Iweala said the country experienced 50 per cent cut in revenue due to fall in oil prices coupled with low revenue receipts from non-oil sources as most companies had yet to file in their tax returns in the first quarter of the year.
She said the government resorted to borrowing 473 billion naira, more than half of the N882 billion naira debt provided for borrowing in the 2015 budget.
The minister said in as much as the government had in the past tried to reduce the level of borrowing, such could not be achieved this year due to cash flow problems.
For instance, she said government borrowing was brought down to about N570 billion last year, noting that the figure was reviewed upward this year to cushion the negative impact of drop in revenue.
According to her, government plans to borrow about N380 billion of the N882 billion from external sources, while the balance would be borrowed locally.
She said, “We have tried to work within the budget. The budget provides for N882bn in borrowing and we have had to increase the borrowing budget this year as compared to last year when we actually brought it down.
“If you all recall, we said we would be bringing down borrowing to finance the budget and we have been doing that steadily.
“Last year, the borrowing came down to about N570bn; but this year, because of the very difficult cash flow situation, we have provided N882bn in borrowing.
“About N380bn of that is external borrowing and the balance of N502bn is for domestic borrowing. So, what we’ve had to do to manage this first half is to front-load the borrowing programme, which is a normal reaction that you have because the cash crunch has been very difficult.
“In the budget, we provided for N882bn and all we have borrowed is within the budget. What we have borrowed so far is N473bn; so, we still have more room for borrowing.”
Okonjo-Iweala described the first half of this year as the most difficult time for the government, adding that it would do all within its powers to ensure that the country would not end up bankrupt.
According to the minister, the first part of the year usually witnesses low revenue because tax receipts come in from the middle of the year.
She noted that the fall in global oil price since last year had continued to impact negatively on government revenue.
Okonjo-Iweala said the country experienced 50 per cent cut in revenue due to fall in oil prices coupled with low revenue receipts from non-oil sources as most companies had yet to file in their tax returns in the first quarter of the year.
She said the government resorted to borrowing 473 billion naira, more than half of the N882 billion naira debt provided for borrowing in the 2015 budget.
The minister said in as much as the government had in the past tried to reduce the level of borrowing, such could not be achieved this year due to cash flow problems.
For instance, she said government borrowing was brought down to about N570 billion last year, noting that the figure was reviewed upward this year to cushion the negative impact of drop in revenue.
According to her, government plans to borrow about N380 billion of the N882 billion from external sources, while the balance would be borrowed locally.
She said, “We have tried to work within the budget. The budget provides for N882bn in borrowing and we have had to increase the borrowing budget this year as compared to last year when we actually brought it down.
“If you all recall, we said we would be bringing down borrowing to finance the budget and we have been doing that steadily.
“Last year, the borrowing came down to about N570bn; but this year, because of the very difficult cash flow situation, we have provided N882bn in borrowing.
“About N380bn of that is external borrowing and the balance of N502bn is for domestic borrowing. So, what we’ve had to do to manage this first half is to front-load the borrowing programme, which is a normal reaction that you have because the cash crunch has been very difficult.
“In the budget, we provided for N882bn and all we have borrowed is within the budget. What we have borrowed so far is N473bn; so, we still have more room for borrowing.”
Okonjo-Iweala described the first half of this year as the most difficult time for the government, adding that it would do all within its powers to ensure that the country would not end up bankrupt.
According to the minister, the first part of the year usually witnesses low revenue because tax receipts come in from the middle of the year.
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