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FEC Approves N8.7trn Budget For 2019, Pegs Oil Price At $60bp



The Federal Executive Council yesterday approved a budget size of N8.73trillion for the 2019 fiscal year, which is about N400billion naira less than N9.12trillion budgeted for 2018. It also okayed an oil price benchmark of $60 US dollars, with oil production of 2.3million barrels per day, exchange rate of N305 per US dollars and a GDP growth rate of 3.01 per cent. This is even as the government approved the 2019 to 2021 Medium Term Expenditure Frameworks (MTEF) and Fiscal Strategy Paper FSP. Minister of Budget and National Planning, Udo Udoma, disclosed this after the Federal Executive Council (FEC) meeting presided over by President Muhammadu Buhari at the presidential villa, Abuja. Udoma said the MFTEF/FSP, which will soon be submitted to the National Assembly for approval, is designed to translate the strategic development objectives of the economic Recovery and Growth Plans (ERGP) into a realistic and implementable budget framework for the medium term. He said, “Today Federal Executive Council (FEC) approved the 2019 2021 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) and it was approved and it will be submitted to the National Assembly for their consideration. “The MTEF/FSP that was approved today is designed to translate the strategic development objectives of the Economic Recovery and Growth Plan (ERGP) into a realistic and implementable budget framework for the medium term.
“As you know relevant inputs from engagements with stakeholders, the last of such engagements was just last week, the inputs from stakeholders were part of the document that was submitted.
“The key highlights are the following assumptions which are being proposed for the 2019 budget; oil price benchmark of $60 US dollars, oil production of 2.3million barrels per day, exchange rate of N305 per US dollars and the GDP growth rate of 3.01percent.

“In addition, the MTEF projects a budget size in 2019 of N8.73trillion which is about N400billion naira less than the N9.12trillion for 2018”. her part, Minister of Finance, Zainab Ahmed, disclosed that the council also approved for a loan of $1.5million from the African Development Fund to finance the multinational Lagos to Abidjan corridor highway development project study. According to her, the multinational project will be a highway with six lanes, dual carriageway project that will involve five countries, including Nigeria, Benin Republic, Republic of Cote D’Ivore, Ghana and Togo. She said the decision was taken at the 42nd meeting of the Authorities of Heads of State and Government of the Economic Community of West African States (ECOWAS) in 2013. She stated: “Today, Ministry of Finance went to council to obtain approval for a loan of $1.5million US Dollars from the African Development Fund to finance the multi-national Abidjan-Lagos corridor highway development project study. “The multi-national project that is running from Abidjan-Lagos corridor will be a highway project that will be in six lanes, a dual carriageway highway that will involve five countries including the Federal Republic of Nigeria, the Federal Republic of Benin, Republic of Cote’d’Ivoire, Republic of Ghana and the Togolese Republic. “At the 42nd Ordinary Session of Heads of State meeting of the ECOWAS countries in 2013, this project was discussed and approved. The African Development Bank in 2016 approved the total sum of $13.5million US dollars for the whole of the project to finance both the study in the form of a loan as well as the grant.
“So, this $13.5million US dollars has been distributed among the participating countries and the component for Nigeria is $1.5million. FEC has approved that we accept this facility so that the project study can be commissioned towards the planning of the execution of the highway project itself. Also speaking, Minister of Power, Works and Housing, Babatunde Fashola, said council approved a memo for the award of contract for the rehabilitation of Lagos -Badagry – Seme road project at the cost of N63.023billion.

He explained that the road project, which is a total of 46 kilometers, excludes the parts from Eric More to Okokomaiko section in Lagos. “Council approved 46 kilometers from Agbara to Seme border, out of which 24 kilometers will be six lanes, while 22 kilometers will retain the current four lanes to be reconstructed and rehabilitated,” he noted. He further explained that the road is part of the Lagos/Abidjan corridor, while Nigeria side of it is from Eric More to Badagry to Seme border. “Ghana has done theirs, Cote D’ Ivore has done theirs, Togo and Benin have something in place. Some of them have to move because of coastal erosion by the Atlantic, and how to reintegrate all of that is part of the study that is being funded by the ADB to ensure simple and efficient border controls”, the minister explained. Fashola further stated that the Ministry also got approval for the construction of the road linking Gwarzo to Karaie, a 20-kilometer high way project in Kano State, at the cost of N1.029billion. He added that FEC also gave approval to terminate and re-award the contract for the 10 megawatts Katsina wind energy project. According to him, the project with a total of 37 turbines has 15 already completed, while 22 are in different stages of completion. He pointed out that the 15 completed is already generating about 4 megawatts of electricity and is being used by the Power Distribution Company. He explained that the main contractors are not giving government the kind of cooperation it needs from them, even as it was discovered that the local contractor that they hired is he one actually doing the job. He noted: “We have decided to terminate the contract and use the balance to pay the local contractor who has done 15 to instal, the remaining 22.

“Council approved that at N121.073million out of the existing contract. So, it is not a new contract. It is so that the contractor can complete the work in the next five months”. He said council also approved the African trans Sahara high way project from Algiers to Lagos. “The Nigerian section is the Lagos to Katsina border side, traversing Ibadan, Oyo Ogbomosho, Ilorin, Katsina, Abuja, Kano etc. If you look at what the president has done in the last few days, a committee on the African Free Trade agreement protocols, these are the critical infrastructures that link us. So, from South to North, from Lagos through the West Coast, are the interconnections on how we relate with other African countries,” he added. Minister of Water Resources, Suleiman Adamu also announced that council approved the revised estimated total cost for the construction of Zobe regional water supply scheme in Katsina State, phases 1 (a) and 2, as part of efforts to complete infrastructures inherited by the federal government. Adamu who said the project was first awarded in 1992 but was abandoned, with a new contractor taking over in 2009 but were never paid, stated that the Buhari administration inherited the project at 75% completion in 2015. He added that council approved the augmentation of N12.15billion to bring the project to a total of N22.1billion with an additional completion period of 18 months. He disclosed that the federal government recently signed a N10billion agreement with the Katsina government for the completion of the phase 1 (b) of the project.





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