Economists laud 2016 budget, raise concerns on 38 dollars oil benchmark

Financial experts on Tuesday commended the Federal Government for giving priority to infrastructure development in the 2016 budget, but raised concern on its sustenance with the proposed oil benchmark.

They told the News Agency of Nigeria (NAN) in Lagos that the allocation of 30 per cent of the total budget to infrastructure signalled a departure from the status quo.

Prof. Anthony Monye-Elmina, Head of Department of Economics, University of Benin, said that the budget proposal was worthy of commendation.

Monye-Elmina said that focusing on infrastructure development was critical to reposition the nation’s economy.

He, however, said that the dwindling price of oil at the international market was worrisome, adding that the 38 dollars benchmark might not be sustainable in the long run.

“The budget proposal is a laudable development. Focusing on the development of critical infrastructure was the best thing to do,’’ Monye-Elmina said.

Also contributing, Prof. Sheriffadeen Tella of the Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun, said focusing on infrastructural development was the best thing to do.

Tella explained that if properly implemented, the budget was capable of addressing power challenge and the provision of basic infrastructure that would boost economic growth.

According to him, any variation in the oil benchmark will be accommodated for by revenues from the non oil sector.

Subsequently, the economist called for judicious spending to ensure the smooth implementation of the budget.

In his view, Mr Femi Ekundayo, a former president of the Chartered Institute of Bankers of Nigeria (CIBN), said that the current administration had the discipline to pursue its implementation.

Ekundayo, while praising government’s proposal to intervene in critical infrastructure, urged it to devise a model to monitor and measure the budget’s full implementation.

“I believe there will be accountability in the implementation of the budget. The government should be able to measure performance at the end of the day,’’ Ekundayo said.

NAN reports that the government had proposed N6.08 trillion in the 2016 fiscal year with the allocation of 30 per cent of the total budget to capital expenditure.

“To deliver our development objectives, we have increased the capital expenditure portion of the budget from N557 billion in the 2015 budget to N1.8 trillion, in the 2016 budget.

“For the first time in many years, capital expenditure will represent 30 per cent of our total budget.

“In future years, we intend to raise the percentage allocation for capital expenditure,’’ the president said.