Nigeria’s President to present 2025 budget proposal to parliament today

Nigeria's President, Bola Tinubu, is set to present the proposed 47.96 trillion-naira budget to the joint session of the National Assembly today. However, as final adjustments were made to the proposal, concerns were raised regarding the country's economic outlook and the feasibility of the budget assumptions. Johnson Chukwu, CEO of Cowry Asset Management, provided insights on the challenges facing Nigeria's economy in an interview on CNBC Africa. Chukwu highlighted key issues such as unrealistic budget assumptions, inflationary pressures, and the need for a comprehensive strategy to address economic challenges. Looking ahead to 2025, Nigeria's economic landscape appears uncertain, with various factors impacting the country's fiscal and monetary policies. One of the key points raised by Chukwu was the optimistic budget assumptions underlying the 2025 proposal. He noted that the budgeted crude oil production of 2.06 million barrels per day was significantly higher than the current production levels, raising doubts about the feasibility of achieving such targets. Additionally, the budget's crude oil benchmark of $75 per barrel was deemed unrealistic in light of global dynamics, including potential disruptions in the oil market. Another major concern highlighted by Chukwu was the persistent inflationary pressures driven by factors such as insecurity and food production challenges. He pointed out that high food inflation, coupled with other inflation drivers, was likely to pose a significant hurdle in achieving the projected inflation targets. Addressing these issues would require a concerted effort to boost agricultural production and stabilize the exchange rate. Regarding the Central Bank of Nigeria's monetary policy strategy, Chukwu emphasized the need for clarity and a well-defined inflation targeting strategy. While some analysts expected the CBN to begin monetary easing in the second half of the year, Chukwu expressed skepticism, citing ongoing inflationary pressures and the complex economic environment. He underscored the importance of aligning fiscal and monetary policies to effectively combat inflation and stimulate economic growth. In conclusion, Nigeria faces a challenging economic landscape in 2025, characterized by uncertainties in the global market, inflationary pressures, and budgetary concerns. As the government seeks to navigate these challenges, collaboration between fiscal and monetary authorities will be crucial in shaping effective policies and strategies to steer the economy towards stability and growth. With the budget presentation looming and economic indicators pointing to potential hurdles, Nigeria's journey towards economic recovery and sustainability remains fraught with obstacles.