A business advisory consultant, Wole Ogundare, asserts that President Bola Tinubu’s 2024 budget lacks promise, particularly when examining the anticipated GDP growth rate in relation to the population growth rate.
During an appearance on Saturday’s Sunrise program on Channels Television, Ogundare, referring to the budget as the ‘budget of coasting along,’ expressed that an optimistic budget should ideally feature a GDP growth rate ranging from 7 to 10 percent.
“When you look at the assumptions, the first thing I typically look at is the growth rate. So the macroeconomic framework tend to force you to look at the growth rate. The President projected a 3.76 growth rate; if you look at that growth rate, how does it really make sense?”
“You compare it to the population growth rate in Nigeria. Our population growth rate today is about 2.5, so if you look at 2.5 population growth rate relative to a 3.76 GDP growth, it tells you immediately that this is not a budget of hope, it is a budget of coasting along. Let us just coast along for now.”
“Any budget of hope will be something where the growth rate is about 7 to 10 per cent. So, I guess the guys in charge are being very careful not to overestimate their position, which is why they say, ’look, let us just coast along’. So anything around hope, forget it; Nigerians should just forget it for now because there is nothing hopeful around it,” Ogundare who is also an accountant, said.
He contends that this budget falls short of addressing the majority of the current economic challenges plaguing Nigeria.
“This is not the budget for me that will reduce the japa syndrome; it is not the budget that will also create some huge industrialisation or human capital, massive development, or a budget that can encourage employment—none of those things. This is just let’s coast along for now and all the indicators seem to speak to this,” he added.
Additionally, during the program, Johnson Chukwu, the Managing Director of Cowry Asset Management Ltd., remarked that the suggested budget doesn’t deviate significantly from its predecessors, expressing concern over the ongoing rise in recurrent expenditure.
“We have not seen any strategic initiative that will bring down recurrent expenditure. We have seen a consistent increase in the recurrent expenditure of the government because the structure on which you incur recurrent expenditure is being expanded,” Chukwu said.
On Wednesday, President Tinubu submitted the budget proposal to the National Assembly.
He emphasized that the envisioned 2024 budget of N27.5 trillion aims to foster micro-economic stability, alleviate poverty, and enhance access to social security, among other objectives.
The President outlined key focus areas, including security, local employment generation, macro-economic stability, optimization of the investment environment, human capital development, poverty alleviation, and social security.
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