Coordinating Minister for the Economy (CME) and Finance Minister, Dr. Ngozi Okonjo-Iweala has said that the country is facing serious cash crunch as the federal government is borrowing to meet its recurrent spending obligations, including salaries and overheads.
The Finance Minister also added that President Goodluck Jonathan will sign the 2015 Budget soon although the National Assembly didn’t dramatically alter the budget.
Okonjo-Iweala during the 2015 Budget briefing in Abuja said “As you know, I have been honest with you since the current economic problems started. I would like to repeat: we have serious challenges. Things have been tough since the beginning of the year and they are likely to remain so till the end of the year. We have serious challenges but we also have strengths and if we do the right things, we can keep a steady course and emerge out of the current situation.
“As a result of the 50 per cent decline in oil revenues, the country has faced a difficult cash crunch and the federal government has focused on keeping the economy stable and the government running through a series of measures. We have frontloaded the borrowing programme to manage the cash crunch in the economy.
“Traditionally the first part of the year witnesses low revenue because tax receipts come in from the middle of the year. This has compounded the challenges caused by the steep drop in revenues due to the oil price fall.
“As a consequence of the revenue challenges, there has been no capital budget release so far this year. In spite of this challenge, government has managed to keep the economy stable to the point that the Nigerian economy which is projected to grow by 4.8 per cent this year, is according to respected analysts, doing much better than many other oil producing countries
“One positive feature despite the clear challenges is the fact that food prices, though inching up are still quite stable. Also inflation is still in the single digit. This has helped to reduce some of the pressure that Nigerians are going through.
“We also have the advantage that we are an asset rich country and that is a definite strength. It is a challenging time and requires daily, weekly and monthly management to keep the country going and that’s what we have been doing.”
The Minister while giving a breakdown of the budget confirmed that a total of N142.52 billion was provided in the budget for both petroleum products with N100 billion allocated to petrol and N42.52 billion for kerosene.