The Nigerian government has announced plans to introduce tougher economic measures aimed at cushioning the effect of the drop in crude oil price.
- The Minister of Finance, Dr Ngozi Okonjo-Iweala, announced the austerity plan on Monday
- She says the measure will help cushion the effect of the drop in crude oil price
- The benchmark for crude oil price in 2015 budget has been cut down as a result of the drop in price of crude
- Government has been asked to cut down on expenses
- Crude oil price is hovering around $80 to $82 per barrel
The Minister of Finance and Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala, on Monday appealed to Nigerians to tighten their belts ahead of the stringent economic measures being proposed by the federal government.
There have been a sustained drop in the price of crude oil in the last few months as a result of the US suspension of crude importation.
Dr. Okonjo-Iweala said the Federal Executive Council was proposing a new benchmark for 2015 budget for 73 dollars per barrel against the 78 dollars awaiting approval by the National Assembly.
The Minister told journalists in Abuja that the austerity measures being proposed were meant to cushion the effect of the oil price drop.
She said the government would increase revenue collection targets for the Federal Inland Revenue Service from 75 to 160 billion Naira.
The finance minister also stressed the need for the reduction of government’s expenditure, if the new measures being proposed would have any effect.
She said government must learn to be prudent, and check all loopholes for unnecessary expenditures, for 2015.
The crude oil price at the moment is hovering around $80 to $82 per barrel in the last three months and there are indications that the price could crash further as a result of most OPEC members’ refusal to cut production.