•Sets 2.06m bpd crude production target, oil price at $64/barrel, N1,512 exchange rate

From Juliana Taiwo-Obalonye, Abuja

The Federal Executive Council (FEC), yesterday, approved the Medium-Term Expenditure Framework (MTEF) for 2026 to 2028, outlining Nigeria’s economic outlook, revenue targets and spending priorities for the next three years.

After Wednesday’s session, presided over by President Bola Tinubu, the Minister of Budget and National Planning, Atiku Bagudu, briefed State House correspondents that the MTEF was jointly presented by the Budget Office of the Federation, headed by its Director-General, in collaboration with his ministry.

He explained that the framework introduces a major innovation by distinguishing between target oil production and benchmark oil production.

Bagudu revealed that the Council set an oil production benchmark of 2.06 million barrels per day for 2026 but opted for a cautious 1.8 million barrels per day figure in the fiscal planning. The oil price was pegged at $64 per barrel, with an exchange rate assumption of N1,512 to the dollar for the upcoming budget year.

He noted that the exchange rate forecast reflects the fact that 2026 is just before a general election year, and all parameters were derived from thorough macroeconomic and fiscal analyses by the Budget Office and partner agencies. Inflation is projected to average 18 per cent in 2026.

Based on these assumptions, the total revenue accruing to the Federation in 2026 is estimated at N50.74 trillion, to be shared among the three tiers of government. From this projection, the Federal Government is expected to receive N22.6 trillion, states N16.3 trillion, and local governments N11.85 trillion.

When revenues from all federal sources are consolidated, including N4.98 trillion from government-owned enterprises, total Federal Government revenue for 2026 is projected at N34.33 trillion, representing a N6.55 trillion or 16 per cent decline compared to the 2025 budget estimate.

Bagudu added that statutory transfers are projected at about N3 trillion, debt service at N10.91 trillion, and non-debt recurrent expenditure, including personnel and overheads, at N15.27 trillion. The fiscal deficit for 2026 is estimated at N20.1 trillion, equivalent to 3.61 per cent of GDP.

The MTEF document further shows that nominal GDP is projected at over N690 trillion in 2026, rising to N890.6 trillion by 2028. Non-oil GDP is forecast to increase from N550.7 trillion in 2026 to N871.3 trillion in 2028, while oil GDP is expected to expand from N557.4 trillion to N893.5 trillion within the same period. GDP growth is projected at 4.6 per cent in 2026.

Bagudu said the President believes that with macroeconomic stability now taking root, sustaining reforms and implementing the MTEF faithfully will place Nigeria on a stronger growth path over the next three years.

In addition, the FEC reviewed input from ministers before approving the Medium-Term Fiscal Expenditure Ceiling (MFTEC), a critical guideline set to control government spending and encourage fiscal discipline.

Finance Minister and Coordinating Minister of the Economy Wale Edun stressed that the MTEF was the central agenda item for the meeting. He also announced approval for a $100 million African Development Bank (AfDB) loan dedicated to the Nigeria Youth Investment Fund, targeting entrepreneurs aged 18–35, especially those running small and medium enterprises.

Moreover, the Council endorsed $50 million funding from the Islamic Development Bank for an integrated agricultural development initiative in Yobe State aimed at improving food security and rural livelihoods.

Edun said President Tinubu commended the commitment of his cabinet to the Renewed Hope Agenda and noted that recent economic data showed continued resilience, with GDP growing by 3.89 per cent in the third quarter of 2025. Inflation, he said, had begun easing, while agriculture and industry recorded strong performance.

Despite the progress, the President observed that current growth remains below his 7 per cent annual target, which he considers essential for lifting millions out of poverty. He therefore directed Ministries, Departments, and Agencies (MDAs) to prioritise capital expenditure on growth-enhancing and job-creating projects, noting that the economic management team will streamline these priorities for his final approval.

President Tinubu lauded the Council’s efforts but urged acceleration in economic reforms. Highlighting recent GDP growth improvements, he insisted the rate remains short of his administration’s 7 percent growth ambition. He called on all Ministries, Departments, and Agencies (MDAs) to focus capital spending on projects that create jobs and drive sustainable growth, demanding clearer outcomes from government investments in the future.