Africa`s best oil producer establishes ambitious profit target
Date
5/13/2024 8:05:20 AM
(MENAFN) Nigeria, Africa's leading oil producer, is embarking on a bold initiative to significantly boost its revenue by 60percent in the current fiscal year. The aim, according to Finance Minister Wale Edun, is to maintain sustainable debt levels and address the widespread economic difficulties faced by the nation. Speaking at the Semafor's World Economy Summit in Washington, Edun emphasized the importance of reducing the country's fiscal deficit from 6.1 percent to 3.8 percent of GDP.
Despite the ambitious nature of the revenue target, Edun stressed its necessity in light of Nigeria's escalating public debt, which reached USD108.2 billion by the end of 2023. This figure represents a staggering 123 percent increase since 2012, far outpacing the country's GDP growth rate. Debt financing alone consumed over 90% of the government's budget last year, highlighting the urgency of bolstering revenue streams.
Edun acknowledged that debt would continue to play a role in financing Nigeria's development initiatives. However, he underscored the importance of enhancing revenue generation to address this growing burden effectively. Drawing a parallel with the United States, Edun noted that while both countries grapple with substantial debt, the key difference lies in having sufficient revenue through taxes and other government income to service it.
To bolster revenue, Nigeria is prioritizing efforts to ramp up its oil production to at least 2 million barrels per day (bpd). However, the nation fell short of its 2023 production target of 1.69 million bpd, managing only 1.47 million bpd according to the Nigerian Upstream Petroleum Regulatory Commission. Despite this setback, Nigeria remains committed to enhancing its oil output as part of its broader strategy to boost revenue and mitigate its debt burden.
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