from the oil and gas sector by 80 per cent to N1.1 trillion and also slashing its total projected earnings by 54.65 per cent to N3.9 trillion.
As a result of the impending economic difficulties, the team said the Federal Government is projecting Nigeria’s Gross Domestic Product to contract by 3.5 per cent, year-on-year in 2020, while oil earnings is projected to also decline by 90 per cent in the same year. The government noted that although similar challenges were faced in 2016, the impact would likely be severe as Nigeria currently has significantly lower fiscal buffers.
To this end, it stated that the amount accruable to the Federation Account was now projected at N3.9 trillion, as against N8.6 trillion previously projected in the 2020 budget, while it put the projected federal government receipt from federation account for 2020 at N2.4 trillion, compared to N4.8 trillion previously stated.
“Debt service pressure to be eased by significant moratoriums on new loans and expected deferrals of current debt service obligations until macro conditions improve.”