Nigerian parliament seeks to up spending with budget plan

(AFP)
ABUJA — Nigeria's parliament on Thursday approved a $31 billion budget for 2012 for Africa's largest oil producer, setting up a possible showdown with President Goodluck Jonathan, who has sought a lower spending plan.

Nigeria's Senate approved the plan, which had already been assented to by the House of Representatives in the continent's most populous nation. Jonathan must now decide whether to accept it.

The 4.9 trillion naira ($31 billion, 23.7 billion euro) budget is up from 4.75 trillion naira initially proposed by Jonathan, who has subsequently sought to reduce the total even further to 4.65 trillion naira.

Parliament's spending plan also raises the oil benchmark price to $72 per barrel compared to $70 proposed by Jonathan. The benchmark is key since revenue earned above that price is put into a government savings account.

It maintained Jonathan's proposed oil production estimate of 2.48 million barrels per day -- a figure some analysts call high since Nigeria has been producing between 2.0 and 2.4 million barrels per day in recent months.

Nigeria supplied 2.14 million barrels of crude last month, according to the International Energy Agency's latest report.

The budget plan also bets on 7.2 percent growth in the economy, an inflation rate of 9.5 percent and an exchange rate of 155 naira to the dollar.

Nigeria has long been considered to have enormous potential with its burgeoning population and large-scale oil production, but it has been plagued by pervasive corruption and the government has been unable to provide basic infrastructure such as adequate electricity.