By selling off certain government assets in 2024, the federal government hopes to raise N298.4 billion in revenue. This can be found in the 2024 appropriations bill breakdown document. The item identified as “Financing Item” was included in the sectoral allocation details made public by Solomon Adeola, the chairman of the Senate Committee on Appropriations.
The action is thought to be an attempt to lessen the federal government’s financial burden while also financing public debts. The document also stated that the government anticipates a net surplus of N2.8 trillion from government-owned businesses in the fiscal year 2024.
President Bola Tinubu presented the N27.5 trillion 2024 budget proposal to the National Assembly last Wednesday. The national revenue estimated in the budget, dubbed the “Budget of Renewed Hope,” is N18.32 trillion, with a N9.18 trillion deficit.
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With a public debt of N87.38 trillion and a debt service-to-revenue ratio of 73.5%, Nigeria continues to struggle to generate enough revenue to pay for its capital and ongoing expenses. The ratio of the nation’s deficit to GDP is currently 6.1%. But by 2024, President Tinubu expects the percentage to drop to 3.9%. The public has previously protested against any attempt by the government to transfer some of its assets to the private sector in order to increase revenue and pay for its spending.
The Minister of Finance and Co-ordinating Minister of the Economy, Wale Edun, speaking on the budget, said the privatization effort will drive macroeconomic growth as well as allow investors to participate optimally in the economy.
He said, “There is privatization in the budget. That is the direction of travel to create a stable macro-economic environment in which investors can come in and the government is yielding grounds to them and allowing them to come in and invest and provide goods and services to Nigerians.”
Implications of selling national assets
The implications of selling national assets can have wide-ranging effects on a country’s economy and its citizens. Firstly, the sale of national assets can lead to a loss of national control over key industries and resources. This can potentially result in foreign ownership and influence, which may not align with the long-term interests of the country. Furthermore, the sale of national assets can also lead to a loss of revenue and potential job losses, as these assets are often significant contributors to a country’s economy.
Secondly, selling national assets can have a negative effect on the overall economic stability of a country. National assets, such as state-owned enterprises or natural resources, are often key pillars of the economy. Their sale can disrupt supply chains and lead to market concentration, as they are often sold to already dominant players in the market. This can reduce competition and potentially result in higher prices for goods and services, harming the overall welfare of the citizens.
