By Peter Egwuatu, Victor Ahiuma-Young, Sebastine Obasi, Godwin Oritse, Franklin Alli & Rosemary Onuoha
LAGOS—Reactions from the various segments of Nigerian economy operators have indicated some level of optimism that the country’s economy would be improved with a full implementation of the 2018 budget.
But some sections of the experts expressed concern that not only has implementation been the bane of all good budgets, the 2018 budget still has some weak points.
They were reacting to the provisions of the 2018 Appropriation Bill, tagged ‘Budget of Consolidation’ presented to the National Assembly by President Muhammadu Buhari two days ago.
While positive consensus centred on the allocations to capital expenditure, CAPEX, most uncomplimentary remarks centred on lack of faith in government’s poor implementation record over the years, lamenting that 2018 budget would likely suffer same fate.
Good timing, but we wait for line items breakdown — BudgeIT
Mr. Oluseun Onigbinde, Lead Partner, BudgIT, a leading budget advocacy organisation based in Lagos, said: “BudgIT welcomes the relatively early presentation of the 2018 budget and accepts that the economy requires significant fiscal injections to sustain and accelerate economic growth.
“Significant investment in infrastructure, education and agriculture, among others, are also important if the country’s hope of diversifying government revenue and export base is to be sustained.
“Also, we believe the revenue projection of N6.6 trillion is very optimistic, considering that the total retained revenue of the Federal Government, including non-oil and oil-related revenue in 2015 and 2016, was N2.8trillion and N2.6trillion respectively.
CAPEX will ease cargoe movements —Shippers’ Council
Executive Secretary of Nigerian Shippers’ Council, NSC, Mr. Hassan Bello, said: “The N8.6 trillion proposed budget for 2018 is a budget for infrastructural development, a development that will enhance economic growth.
“The capital aspect of the budget is an indication that more has been allocated to capital expenditure than recurrent, which, accordingly, will see more high ways being built, more rail lines will be constructed and these will ease the movement of cargoes from the ports.
More opportunities for insurance industry —CEO, Equity Assurance
Managing Director/CEO Equity Assurance Plc, Mr. Moruf Apampa said: “Government should ensure that the budget is fully implemented. For me, it is about implementation.
“Once the government fully implements the budget, the economy will improve. There could be so much spending next year, so that means so much opportunity for the insurance industry.
Good on infrastructure devt —MAN
President, Manufacturers Association of Nigeria, MAN, Frank Jacobs, said : “We applaud the initiatives of the President in his promise to construct the 2nd Niger Bridge, reconstruct East West Road, North-East Road and the provision of infrastructure in the country.
Most gratifying is the fact that more infrastructure development projects are provided for in the proposed 2018 budget. There is a plethora of evidences to support the fact that quantity and quality of infrastructure would directly raise the productivity of human capital, physical capital, hence economic growth.
Oil price benchmark good— Oil industry chiefs
Abiodun Adesanya, Chief Executive Officer, Degeconek Nigeria Limited, a petroleum geosciences, reservoir engineering and project economics consulting firms said: “The government’s projection is realisable.
“The projections are achievable, provided there is no disruption to daily production through vandalism of infrastructure and there is no cut in production by Organisation of Petroleum Exporting Countries, OPEC.”
Bank-Anthony Okoroafor, Chairman, Petroleum Technology Association of Nigeria, PETAN, said: “The projection appears realistic. Projecting oil price on $45 per barrel is realistic based on what has been happening to oil price.”
PENGASSAN cautions against selling oil, gas assets
However, Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, has cautioned the Federal Government against selling profitable oil and gas assets or selling assets in the industry as scrap to fund the 2018 budget.
The umbrella body for senior workers in petroleum sector, expressed its support for any other measure to fund the budget aside selling oil and gas assets, and called on National Assembly to reject as it had done in the past because the plan is not in the national interest.
Reacting to plans by the government to sell the oil and gas assets to fund the budget, PENGASSAN National Public Relations Officer, Fortune Obi, noted that the idea was rejected by majority of Nigeria when it was first mooted in 2016.
Good in CAPEX, bad in debt servicing — APT Securities
Managing Director/CEO, APT Securities & Funds Limited, said: “It is an expansionary budget, which the economy needs to fully recover from recession. The proportion of the recurrent expenditure is gradually coming down while the capital expenditure is increasing, which is good for development. However, N2 trillion for debt servicing is on the high side. There is a need for caution or restructure our debt to less expensive options.
Just rituals, no implementation—Highcap Securities
Managing Director/CEO, Highcap Securities, Mr. David Adonri, stated: “I am no longer thrilled by the ritual of budget presentation. They don’t implement it. It’s just deceit and academic exercise. All the past budgets by past leaders are all good, the problem we have in this country is that of sincere implementation.”
Too little at N50,000 per annum per Nigerian— ISAN
Mr. Moses Igbrude, spokesperson for Independent Shareholders Association of Nigeria, ISAN, said: “Having a budget is one thing, while the funding and the required will to implement it to the fullest is another ball game entirely. How does this N8.6 trillion budget translate into real economic benefits to ordinary Nigerian? If we are to divide the N8.612 trillion over 170 million estimated population one Nigerian will get N50,658.82 per year. It is as low as that, but to achieve meaningful progress, the Federal Government and other arms of government must work together to eliminate wastages by blocking all leakages in the system.”