Wale Edun, the Minister of Finance and Coordinating Minister of the Economy has said that the federal Government would take a second look at the 2025 budget assumptions.
Edun’s statement is coming after US President Donald Trump slapped a 14 per cent tariff on non-mineral exports.
This was disclosed at the corporate governance forum on Monday in Abuja, where a performance scorecard for State Owned Enterprises (SOEs) was also launched.
In the 2025 Appropriation Act, Nigeria pegged its crude oil benchmark at $75 per barrel.
According to him, the adverse effect of tariff hike would be felt through oil price plunge, stressing that the part of the solution thrown up by the situation would be to intensify efforts to ramp up crude oil production curtail any price effect
He noted that the economic management team will look at the various scenarios and advise the government accordingly.
“The economic management team would look and make sure that they are on top of the situation. Based on the announcements made in April to exempt mineral exports, including oil. So therefore, it’s the price effect, the oil price effect, that may well feed through. And it is the job and responsibility of the economic management team of President Bola Ahmed Tinubu, amongst others, to look at the various scenarios that might play out.
“There’s global uncertainty at a huge level, so nobody knows exactly what will happen based on announcements that have been made, we’re not sure what will be delayed, what will be reversed, or what will be implemented. So, it is not an announcement that the budget is being reviewed. It’s an announcement that it is our responsibility to look at the various scenarios and options and advise the government accordingly,” he added.
The minister further disclosed Nigeria-US trade has been in surplus in the last 3 years (2022-2024). He said that Nigeria’s export to the US was N1.8 trillion, N2.6 trillion and N5.5 trillion in 2022-2024 respectively.
He stressed that oil and mineral exports accounted for 92 per cent implying oil and minerals exports amounted to N5.08 trillion in value while non-oil was just N0.44 trillion
“Consequently, the tariff effect on exports is negligible if we sustain our oil and minerals exports volume.
“We’re also focusing on non-oil revenue mobilization by FIRS and Customs,
“Budget adjustment and prioritization where possible, and also innovative non-debt financing strategies, ” he said.
Meanwhile, the Minister of Power, Adebayo Adelabu noted that the sector is facing challenges due to lack of adherence to good corporate governance practices.
According to the minister, poor governance and performance management practices have eroded value across government owned entities in the power sector value chain.
“Let me give you practical examples of out of about 14,000 megawatts installed capacity that we have across our generating plants. Government owned plants constitute about 30% of this capacity, usually over 4000 plants owned by Niger Delta power holding company which is 100% owned by the government.
“It will surprise you that all these plants with installed capacity of over 4000 megawatts since inception, have not generated beyond 20% of their capacity. They have produced between 500 megawatts and 800 megawatts out of over 1000 megawatts of capacity. You can only imagine if compared to private sector owned plants like Azura, Transcorp, Pacific, all that have performed the worst, which is why corporate governance of mass government practices must be items on the priority list of the managers of government shares in all these enterprises,” he said.
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