The federal government has predicted an increase of 4.2 percent in Nigeria’s Gross Domestic Product (GDP) by 2022.
The Minister of Finance, Budget, and National Planning, Zainab Ahmed, disclosed this at the Public Consultation on the Draft 2022 to 2024 Medium Term Fiscal Framework and Fiscal Strategy Paper (MTFF/FSP) on Thursday, July 1.
Ahmed explained that the GDP projected in 2021, to close at three percent, had been adjusted downwards to close at 2.5 percent.
According to her, “In 2022, we are expecting an uptake to 4.2 percent, then a dip to 2.3 percent in 2023 and up to 3.3 percent in 2024.” She added that the Nominal GDP projected for 2022 was N184.38 trillion up from N168.6 trillion in 2021, and then to N201 trillion in 2023 and N222 trillion in 2024.
The minister attributed the increase in inflation to the exchange rate, she expects the inflation rate to drop slightly to 13 percent in 2022 from 15 percent in 2021. She said, “inflation rate, which was planned for 11.95 percent in 2021, has been reflected in reality because the exchange rate is high. The average we have so far is 15 percent. We are expecting 2022 to go down slightly to 13 percent, then 11 percent in 2023 and 10 percent in 2024.”
However, she also explained that said the government had put the Nigerian Autonomous Foreign Exchange Rate Fixing (NAFEX) rate of N410.15 to one US dollar for 2022 to 2024.
According to her, “The exchange rate of the Naira to the dollar, which was N379 in the 2021 budget, has been adjusted to the NAFEX rate of N410.15 to one US dollar. We are assuming, for now, the same rate for 2022, 2023, and 2024.”
The minister took an overview of the federation and fiscal outcomes for the Federation and Value Added Tax (VAT) Pool Accounts Distributable for January to May. Ahmed explained that the amount available for distribution from the Federation Account was N2.78 trillion.
She added: “Of this amount, the Federal Government received N998.57 billion, while the states and Local governments received N506.59 billion and N390.48 billion respectively from the Main Pool Account. Federal, state and local governments received N132.70 billion, N442.33 billion and N309.63 billion respectively from the VAT Pool Account.”