Reps adopt MTEF as Buhari presents 2017 budget

Nigeria's lawmakers have adopted the Medium Term Expenditure Framework and Fiscal Strategy Paper just before the President's presentation of the 2017 budget estimates to a joint session of the National Assembly today. Michael Famoroti, an economist at Vetiva Capital Management, joined CNBC Africa to evaluate Nigeria's budget process. Famoroti highlighted the importance of implementation and funding in assessing the upcoming budget. While optimism surrounds the 2017 budget and its potential to drive economic prosperity and end the recession, concerns linger over the difficulties in fully implementing past budgets and the funding challenges faced by the government. A major point of discussion was the comparison between the 2016 and 2017 budgets. Famoroti noted that the Minister for Budget and Planning mentioned the 2017 budget being smaller in dollar terms compared to its predecessor. Nevertheless, given the underperformance of the 2016 budget and persistent funding issues, questions arise regarding the feasibility of successful implementation. Furthermore, the reliance on external financing adds another layer of complexity to the funding landscape. Famoroti speculated on the challenges in scaling up loan financing plans and emphasized the critical role of revenue generation in alleviating financial constraints. With the hope of improved oil prices and oil production in the upcoming year, the government aims to boost revenues and address funding gaps. However, the discovery of an additional unrecorded debt of approximately 2.2 trillion Naira raised concerns about legacy issues and debt management. Famoroti acknowledged the government's plans to issue promissory notes to address these debts but highlighted the pressure on revenue generation and the potential implications for investment. As Nigeria navigates the intricacies of its budgetary process and grapples with historical debts and funding challenges, the success of the 2017 budget hinges on effective implementation, robust revenue generation, and prudent financial management strategies.