Highlights: 2021 Federal Government of Nigeria Budget proposal

2021 National Budget: Issue no. 10.2 | October 2020

His Excellency, the President of the Federal Republic of Nigeria, Muhammadu Buhari, GCFR, today 8 October 2020, presented the 2021 Federal Government Budget Proposals before a joint sitting of the National Assembly. The proposed Revenue and Expenditure budgets for 2021 are ₦7.89 trillion and ₦13.08 trillion, respectively, resulting in ₦5.20 trillion fiscal deficit.

Wole Obayomi

Partner, Tax, Regulatory & People Services

KPMG in Nigeria


Below are the key assumptions behind the budget and movements in the proposed fiscal parameters between the revised 2020 and 2021 Budgets:


Budget Assumption/ Fiscal Parameter 2020 Approved Budget 2020 Revised Budget 2021 Proposed Budget Percentage Change
Benchmark oil price US$57 per barrel  US$28 per barrel US$40 per barrel 43%
Oil production volume (bpd) 2.18 million 1.80 million 1.86 million 3%
Average exchange rate ₦305/ US$1 ₦360/ US$1 ₦379/ US$1 5%
GDP Growth rate (%) 2.93 -4.42 3 168%
Capital expenditure ₦2.46 trillion ₦2.49 trillion ₦3.60 trillion 46%
Statutory transfer ₦0.56 trillion ₦0.43 trillion ₦0.48 trillion 13%
Debt service (inclusive of sinking fund) ₦2.73 trillion ₦2.95 trillion ₦3.34 trillion 13%
Recurrent expenditure (non-debt) ₦4.84 trillion ₦4.94 trillion ₦5.65 trillion 14%
Total revenue ₦8.42 trillion ₦5.84 trillion ₦7.89 trillion 35%
Total expenditure ₦10.59 trillion ₦10.81 trillion ₦13.08 trillion 21%
Fiscal deficit ₦2.17 trillion ₦4.98 trillion ₦5.20 trillion 4%

Source: Ministry of Budget and National Planning; 2020 Appropriation Act

The 2021 Budget, which has been themed the “Budget of Economic Recovery and Resilience”, is designed to deliver on the Government’s Economic Sustainability Plan goals, accelerate the pace of Nigeria’s economic recovery, promote economic diversification, enhance competitiveness and ensure social inclusion.

The President used the opportunity of the 2021 Budget presentation to announce the preparation of the Finance Bill, 2020 by the Honourable Minister of Finance, Budget and National Planning for passage with the 2021 Appropriation Bill. The Finance Bill, 2020 will seek to support the realization of the 2021 revenue projections, adopt appropriate counter-cyclical fiscal policies and enhance the efficiency of fiscal incentives.

We will publish our 2021 Budget Newsletter after the Honourable Minister of Finance, Budget and National Planning submits the detailed budget.

For further enquiries, please contact:

Wole Obayomi


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