The Nigerian House of Representatives has approved the 2025-2027 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP), following the consideration and approval of the Joint Committee on Finance and National Planning. The document outlines key fiscal projections that will guide the preparation of the 2025 budget and government expenditures over the next three years.
Key Highlights:
- Oil Benchmark Prices: The House approved the projected oil benchmark prices for 2025 at $75 per barrel, with slight increases for the following years: $76.20 per barrel in 2026 and $75.30 per barrel in 2027.
- Crude Oil Production: The framework projects Nigeria’s domestic crude oil production to reach 2.06 million barrels per day in 2025.
- GDP Growth: Nigeria’s Gross Domestic Product (GDP) growth rates are projected at 4.6% for 2025, 4.4% for 2026, and 5.5% for 2027.
- Exchange Rate: The exchange rate is expected to remain stable at 1,400 Naira to 1 US Dollar for 2025, 2026, and 2027.
The passage of this framework is a significant step in the budgeting process, as it will serve as the basis for the preparation of the 2025 budget. President Bola Tinubu had previously emphasized the importance of timely legislative action on the framework to ensure smooth implementation.
Related Financial Matters: In addition to the MTEF/FSP approval, President Tinubu had also requested the House’s approval for a new external borrowing plan. The government aims to secure $2.209 billion in external loans under the 2024 Appropriation Act. This is part of a broader strategy to manage Nigeria’s financial obligations and support its economic recovery.
Government’s Borrowing Strategy: The Federal Executive Council (FEC) recently approved a $2.2 billion external financing program to support the federal government’s borrowing efforts. This funding will be sourced through Eurobonds and Sukuk bonds, aiming to meet fiscal needs and bolster Nigeria’s economy.
This comprehensive fiscal plan underscores Nigeria’s commitment to maintaining economic stability and securing necessary funding to support infrastructure, social programs, and recovery efforts in the coming years.
