LAGOS, Oct. 14 (Xinhua) -- Oil price crash on international market has delayed the presentation of the proposed 2009 budget to the National Assembly by the Nigerian Federal Government.
A Ministry of Finance source said in Abuja on Monday that the Federal Government is currently adjusting the 2009 appropriation bill, especially as the proposed crude oil price benchmark of 62.5 U.S. dollars per barrel would have to be changed to align with the current realities in the international oil market.
Central Bank of Nigeria (CBN) Governor, Chuk-wuma Soludo, told journalists in Washington on Monday that falling prices and the search for alternative sources of energy are threats to Nigeria, according to a report on This Day.
Crude oil prices in the international market had risen to all-time high of 147 dollars per barrel in the second quarter this year and has plunged to 85 dollars per barrel last week and even plummeted to a 13-month low of 77.70 dollars per barrel after losing 8.89 dollars a barrel last Friday on the New York Mercantile Exchange, the second biggest decline ever.
The Nigerian Federal Government had late last month pegged the benchmark for the 2009 budget at a comfortable 62.5 dollars per barrel, but has now realized that based on trend in the international market, the benchmark may be a bit risky.
Although a new figure has not been fixed for the benchmark, it is expected to be lower than 59 dollars per barrel on which the 2008 budget was predicated.
The difference between the benchmark and the actual price is saved in the controversial Excess Crude Account, which is regularly shared by the three tiers of government. The special account forms part of Nigeria's foreign reserves.
It is learnt that Nigerian President Umaru Musa Yar A'dua had directed the Secretary to the Government of the Federation (SGF), Alhaji Yayale Ahmed, to set up an Inter-ministerial Committee headed by the Minister of State for Finance Remi Babalola, to adjust the 2009 Budget.
The budget, which work is at an advanced stage, is expected to be presented to the Federal Executive Council in October for approval and onward presentation to the National Assembly by Yar'Adua.
The president has directed that for the 2009 Budget, allocations for the purchase of cars and overseas training should not be included.
The 2009 Budget is expected to focus on the priority areas of the seven-point agenda of the administration.
The Federal Government has said the next budget will be a clear departure from the past.
Starting with the 2009 Budget, there will be a performance appraisal of the budget with the ministers and permanent secretaries of federal ministries responsible for poor performance of the budget.
Meanwhile, Soludo has warned that the tumbling price of oil and the global search for alternative sources of energy represent a "double threat" to Nigeria, which relies heavily on the commodity for its national revenue and budget.
Soludo made the statement during a press briefing with Nigerian journalists attending the World Bank and the International Monetary Fund (IMF) annual meetings.
The CBN governor who led the Nigerian delegation to the event cautioned that the country must acknowledge this reality and respond to it adequately in the interest of its people.