Report
EUR 3.48 For Business Accounts Only

Nigeria Strategy Report H1 2018 Excerpts- Fiscal Policy: Sharper Picture but still blurry

  • Our analysis suggests that the fiscal deficit could range between N9 trillion and N4.8 trillion if the planned expenditure of N8.6 trillion is fully implemented. However, we do not foresee full budget implementation as in recent years when it has hovered around 75%. Thus, in 2018, we look for a budget implementation of 85% given that the year is the last chance for the Buhari administration to meet the expectations of the electorates before the 2019 elections. This, under our base scenario, implies an expenditure of N7.3 trillion and a fiscal deficit of N2.9 trillion (+45% increase over budgeted deficit of N2.0 trillion).

 

2018 Budget

Estimates

 

 

Bear

Base

Bull

Oil production (mbpd)

2.3

2.0

2.0

2.0

Oil price ($/bbl.)

45

50

60

70

Exchange rate (N/$)

305

305

305

305

Oil and gas receipts (N' billion)

4,955

4,787

5,749

6,702

Net Oil Revenue (N' billion)

4,955

4,787

5,749

6,702

FG Share of oil revenue (N' billion)

2,091

2,020

2,426

2,828

Non-Oil revenue (N' billion)

1,395

881

991

1,028

FG independent revenue (N' billion)

848

251

287

450

Other revenue (N' billion)

1,654

846

705

1,450

FG Total revenue (N' billion)

6,607

3,786

4,408

5,756

FGN Expenditure (N' billion)

8,612

7,320

7,320

7,320

Fiscal deficit (N' billion)

(2,005)

(3,534)

(2,912)

(1,564)

Provider
ARM Securities Limited
ARM Securities Limited

ARM Securities Limited is a full-service brokerage house that offers best-in-class brokerage services to local as well as foreign private and institutional investors. Formerly known as Hamilton Hammer, the Company commenced operation in 1994 and was acquired by ARM Investment Managers in 2008--an acquisition which has successfully re-positioned the company as a recognized brokerage firm in Nigeria. The Company is a dealing member of the Nigerian Stock Exchange (NSE) and is regulated by Securities and Exchange Commission (SEC). ARM Securities research team provides insightful commentaries on the Nigerian economy and its equity and debt markets using an approach which incorporates a thorough understanding of the fundamentals of the industries and companies under coverage. The research therefore adopts an integrated methodology of top-down analysis and bottom-up stock selection, which focuses on publicly quoted companies on the Nigerian Stock Exchange that are judged to offer the highest potential for earnings growth. In addition, its analysts provide periodic commentaries on a range of topical global and local issues which provide investing clients with a holistic view of the opportunities and risks in today’s financial market landscape. ​

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