Nigerian President Muhammadu Buhari approved Thursday the nation’s 2021 budget which foresees a massive increase in spending as Africa’s top economy struggles with recession and the coronavirus pandemic.
The 13.59 trillion naira ($35.6 billion, 28.1 billion euros) in spending is a roughly 20 percent gain from 2020 and a local currency record.
However, the gain is marginal in dollar terms, an indication of the weakness of the naira.
Nigeria’s main export, crude oil, saw prices plunge in 2020 as the coronavirus pandemic ravaged demand for energy and sent economies around the world into tailspins.
Nigeria’s economy has also been pushed into recession and the weak naira has made imports of food and consumer goods more expensive.
“During the year, I expect that we would be able to significantly reduce the adverse impact of the coronavirus pandemic on the cost and availability of basic food items,” Buhari told lawmakers.
The International Monetary Fund expects that Nigeria’s economy will have shrunk by 5.4 percent in 2020, while the government expects the contraction to be as large as 8.9 percent.
The government has devalued the naira to cope with the crisis, but that has sparked inflation. In October, food prices jumped by 17.3 percent.
According to the World Bank, the coronavirus pandemic and the resulting economic crisis have pushed an additional five million Nigerians into poverty.
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