The federal government has proposed a $30 per barrel benchmark for the 2020 budget, as opposed to the previously set benchmark of $57 per barrel, due to the unstable oil prices caused by the coronavirus pandemic. Minister of finance, Zainab Ahmed, revealed this during a meeting between the executive arm of government and the leadership of the National Assembly in Abuja on Wednesday, March 25.
This meeting, which lasted for 4 hours, focused on reviewing the 2020 budget and Medium Term Expenditure Framework in light of the global economic impact of the Coronavirus pandemic. Zainab emphasized that the reduction in the oil benchmark was necessary to prepare for a worst-case scenario and to protect the Nigerian economy from unexpected crises.
Furthermore, the Minister informed the leadership of the National Assembly that budgeted revenues for the Nigeria Customs Service will be reduced from N1.5 trillion to N943 billion, and privatisation proceeds will be cut by 50 per cent. She also mentioned that the Federal Government has made cuts to revenue-related expenditures for the Nigerian National Petroleum Corporation (NNPC) for various projects included in the 2020 Appropriation Act.
Additionally, the Federal Government is working on Fiscal Stimulus Measures to provide fiscal relief for taxpayers and economic sectors, incentivize employers to retain and recruit staff, stimulate investment in critical infrastructure, review non-essential tax waivers, and complement monetary and trade interventions to respond to the crisis.