(Bloomberg) -- Nigeria's cabinet approved a 20 percent increase in spending proposals next year, taking the figure to 7.3 trillion naira ($23.3 billion), according to the Budget and Planning Ministry.
President Muhammadu Buhari will probably present details of the spending plan to the lawmakers on Dec. 8, the ministry's spokesman Akpandem James said Thursday by phone from the capital, Abuja, citing communication from Budget Minister Udoma Udo Udoma after a cabinet meeting. Lawmakers in the Senate and the House of Representatives will debate the budget proposals and return an approved version to the president to sign into law, he said.
The increased spending proposal from 6.1 trillion this year signals the government's determination to stimulate the economy of Africa's most populous nation that's forecast by the International Monetary Fund to contract by 1.7 percent in 2016. The Senate earlier rejected the government's spending plan for the next three years, as well as a $30 billion foreign-borrowing strategy, on the grounds that the proposals lacked details.
Nigeria's economy has contracted every quarter so far this year as output of oil, the country's biggest revenue earner, declined due to attacks by militants on pipelines and the low price of crude.
The approval of the 2016 budget was delayed by five months adding to the economy's contraction. New spending plans probably won't be approved before February, according to Manji Cheto, senior vice president at Teneo Intelligence.
“Nigerian lawmakers typically take up to four months to deliberate on budgets, even after granting their approval” to the three-year economic framework, which forms the foundation of every budget, Cheto said in an e-mailed note.
To contact the reporters on this story: David Malingha Doya in Abuja at dmalingha@bloomberg.net, Emele Onu in Lagos at eonu1@bloomberg.net. To contact the editors responsible for this story: Rene Vollgraaff at rvollgraaff@bloomberg.net, Karl Maier, Michael Gunn
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