The Federal Government intends to borrow about N4.89tn from internal and external sources to finance the 2022 budget.
It is projected that N13.98trn will be required for the next fiscal year but dwindling revenue has created fear for a huge deficit.
The Minister of Finance, Budget and National Planning, Zainab Ahmed, announced this at an interactive session in Abuja on Monday.
The event was organised by the House of Representatives’ Committee on Finance on the 2022-2024 Medium Term Expenditure Framework and Fiscal Strategy Paper.
Mrs Ahmed noted that perception of the naira as being over valued over despite recent the adjustment by the Central Bank of Nigeria has compounded Nigeria’s risk aversion in the global capital market.
The perception will further put pressure on the foreign exchange market, stressing that foreign portfolio investors have yet to return to the Nigerian market.
Government also plans to reduce capital expenditure by N259.315bn, as the reduction would become necessary due to economic volatility occasioned by unstable global oil market as well as the effects of the COVID-19 pandemic.
The minister said the exchange rate has been pegged at N410.15 to a dollar and oil benchmark at $57 per barrel.