Nigeria Senates Reject Three-Year Spending Plan

LAGOS (Capital Markets in Africa) Nigeria’s Senate rejected the government’s spending plan for the next three years, less than a week after dismissing its $30 billion foreign-borrowing strategy on the grounds that the proposals lacked details.

Budget and National Planning Minister Udo Udoma “is meeting with his fellow Senators today” on the matter, and will resubmit the 2017-19 spending framework with all details requested by Nov. 7, ministry spokesman James Akpandem said Friday by phone from the capital, Abuja. The government can present its 2017 budget proposals to the lawmakers for consideration only after this plan is approved, he said.

A five-month delay in approving Nigeria’s 2016 budget contributed to gross domestic product contracting in the first half of the year because planned spending to boost an economy battered by dollar shortages and low oil prices and production had to be pushed back. The International Monetary Fund forecast GDP in Africa’s most populous country will shrink 1.7 percent this year, the first full-year contraction in more than two decades.

According to the new budget plan, the government wants to boost spending by 12 percent to 6.87 trillion naira ($22 billion) in 2017 to help stimulate output. The framework projects the fiscal deficit will widen by 22.7 percent to 2.7 trillion naira, which would be partly funded by a three-year plan to borrow $30 billion abroad.