Nigeria’s presidency is expected to sign the 2017 budget into law next week, the speaker of the lower chamber of parliament, Yakubu Dogara, and two presidency sources said on Friday.
Lawmakers agreed last month to increase spending this year by 21 percent to N7.4 trillion ($23 billion) to help the West African economy recover from its worst slump in 25 years.That compares to a budget of N7.3 trillion that President Muhammadu Buhari proposed on Dec. 14. The approved appropriation bill now awaits the President’s assent to become law.
President Muhammadu Buhari has been on medical leave in Britain since May 7 and handed over power to his deputy, Yemi Osinbajo, in his absence. It is likely that Acting President Osinbajo will sign the budget in Buhari’s absence.
“The 2017 Appropriations Bill … will be signed into law early next week,” said Yakubu Dogara, speaker of the House of Representatives, at an event to mark two years since parliament was convened after elections in 2015.
“Two presidency sources, who did not want to be named, also said the budget would be signed next week,” a June 9 Reuters report read.
Nigeria’s economy, which vies with South Africa’s to be the largest on the continent, shrunk by 1.5 percent last year, the first contraction since 1991, after revenue from oil, its biggest export, fell by almost half. About 30 percent of the budget will be spent on roads, rail, ports and power to help stimulate business activity.
The budget’s passage paves the way for the government to borrow N2.3 trillion, 46 percent of which will be from abroad, to help plug this year’s fiscal deficit at 2.18 percent of gross domestic product.
The implementation of Nigeria’s Economic Recovery and Growth Plan (ERGP), tipped by government officials to restore economic growth, is also hinged on the budget, with early passage critical to help the economy out of recession. The economic contraction was milder in the first three months of 2017, with the manufacturing sector returning to growth after five consecutive quarters of contraction and the oil sector gradually recovering. This has boosted hopes of a recovery in the second or third quarter.
The IMF tips the economy to grow 0.8 percent this year.