Provisional data from the Central Bank of Nigeria (CBN) indicated that total federally-collected revenue stood at N5.5 trillion as at June this year. This represents a 15.1 and 17.2 per cent increase in both the proportionate budget estimate for fiscal 2012 and the actual revenue in the corresponding period of 2011, respectively.
The apex bank’s Half Year Economic Report released at the weekend showed that oil-revenue contributed 78.1 per cent and non-oil revenue accounted for the balance. Also, at N1.7 trillion, the government’s retained revenue was 12.4 per cent lower than the proportionate budget estimate but higher than the level in the first half of 2011 by 33.4 per cent.
The report said aggregate expenditure of the government was N2 trillion, 20.9 per cent lower than the proportionate budget estimate, but exceeded the amount expended in the first half of 2011 by 3.3 per cent.
It said the lower expenditure performance reflected the delayed disbursements of capital budget and transfers. However, the fiscal operations of the government resulted in an overall notional deficit of N281.82 billion or 1.5 per cent of Gross Domestic Product (GDP), compared with the proportionate budget deficit of N568.31 billion and the actual deficit of N650.23 billion at end-June 2011.
However, at N7.1 trillion, government’s consolidated debt comprised domestic N6.1 trillion billion and external $6.04 billion (N950.61 billion) rose by 17.6 per cent above the level at end-June 2011.
Also, aggregate institutional savings, at N7.5 trillion, declined by 11.5 per cent from the level in the corresponding half year of 2011. The commercial banks remained the dominant savings institution, accounting for 91.2 per cent of the total. Transactions on the floor of the Nigerian Stock Exchange were bullish as the All-share Index (ASI) and aggregate market capitalisation rose by 4.2 and 20.4 per cent, to close at 21,599.57 and N12.4 trillion, respectively, at end-June 2012.
The GDP at 1990 constant basic prices grew by 6.4 per cent, compared with 7.4 per cent in the corresponding period in 2011. It attributed the growth to the non-oil sector which rose by 7.8 per cent and contributed 85.2 per cent of the GDP.
Inflationary pressures which persisted through the first and second half of 2011 continued into the first half of 2012 as the composite Consumer Price Index (CPI) stood at 135.3 compared with 119.9 and 126.0 at end-June and end-December 2011, respectively.
The year-on-year headline inflation edged-up to 12.9 per cent at end-June 2012, from 10.2 per cent in the corresponding period of 2011. However, the 12-month moving average trended downward to 11.3 per cent at end-June 2012, compared with 12.3 per cent at end-June 2011.
The performance of the external sector improved, following the sustained high price of crude oil at the international market. Consequently, the current account recorded an estimated surplus of N1.4 trillion, or 7.7 per cent of GDP and engendered a balance of payment surplus of N438.93 billion or 2.3 per cent of GDP.
The International Monetary Fund economic growth projections indicated that global recovery remained weak, thus growth was projected to moderate at 3.5 per cent in 2012 and the advanced economies were estimated to grow at an average of 1.4 per cent. Growth in the United States was estimated to strengthen modestly at two per cent and that of Japan at 2.4 per cent, following recovery from earthquake-related losses.
Credit to the domestic economy declined by 2.7 per cent due to the substantial fall in claims on the government. The Federal Government was a net creditor to the banking system as the credit to government (net) declined by 177.8 per cent at end-June 2012. Instruments of short-term maturity remained dominant in the structure of credit and deposit portfolios of deposit money banks.
Banks’ average prime and maximum lending rates rose by an average of 125 and 127 basis points, respectively, while the spread between banks’ average term deposit and maximum lending rates narrowed to 16.46 percentage points from 17.60 percentage points in the first half of 2011. With the year-on-year inflation rate at 12.9 per cent at end-June 2012, all the term deposit rates were negative in real terms.
