We will be borrowing about 2 trillion and only 30% of the total budget will be spent on capital expenditure.

This is like borrowing 100 for bizness, investing 30m and sharing 70m among friends and relatives. How will the loan be paid?

There is a projection of increase in non oil revenue. How will that happen when several businesses are suffering due to harsh economic policies?

mekaboy:
We will be borrowing about 2 trillion and only 30% of the total budget will be spent on capital expenditure.

This is like borrowing 100 for bizness, investing 30m and sharing 70m among friends and relatives. How will the loan be paid?

There is a projection of increase in non oil revenue. How will that happen when several businesses are suffering due to harsh economic policies?

Firstly, 100% of borrowed funds will go into capital/infrastructure spending.

Secondly, recurrent expenditure is not like sharing among friends and family. It is like SG&A in accounting.

mekaboy:
We will be borrowing about 2 trillion and only 30% of the total budget will be spent on capital expenditure.

This is like borrowing 100 for bizness, investing 30m and sharing 70m among friends and relatives. How will the loan be paid?

who are the friends and relatives? This is not Pdp era where a whole N3.3 trillion naira flew away. We have capital expenditure and recurrent expenditure. If 30% income is spent on capital expenditure the 70% will be spent on recurrent expenditure. The era of sharing and looting is over because this is a zero-based budget.

mekaboy:

There is a projection of increase in non oil revenue. How will that happen when several businesses are suffering due to harsh economic policies?

non oil revenue are not only revenue from local business alone, they are revenues generated from non oil sector, like solid minirals and some importation duties or real sector

Bevista:
Firstly, 100% of borrowed funds will go into capital/infrastructure spending.

Secondly, recurrent expenditure is not like sharing among friends and family. It is like SG&A in accounting.

I believe 30% of the 6.8 trillion will be spent on capital expenditure . I believe it's mostly infrastructure that drives the economy. The remaining 70% will be used to pay salaries and some welfare programs. But these programs will have little or no impact in revenue generation, since it will enter the stomach and go down the toilet.

Well I hope they know what they are doing.

Jokay07:
who are the friends and relatives? This is not Pdp era where a whole N3.3 trillion naira flew away. We have capital expenditure and recurrent expenditure. If 30% income is spent on capital expenditure the 70% will be spent on recurrent expenditure. The era of sharing and looting is over because this is a zero-based budget.

non oil revenue are not only revenue from local business alone, they are revenues generated from non oil sector, like solid minirals and some importation duties or real sector

This suggests an increase in taxation coupled with the harsh policies.

mekaboy:
I believe 30% of the 6.8 trillion will be spent on capital expenditure . I believe it's mostly infrastructure that drives the economy. The remaining 70% will be used to pay salaries and some welfare programs. But these programs will have little or no impact in revenue generation, since it will enter the stomach and go down the toilet.

Well I hope they know what they are doing.

Not completely true bro. There is usually a transmission effect on consumption on the real economy. For instance, those salaries and welfare payments will be spent by consumers to by products in the market. At the very least, this increased demand will help small companies increase their bottom-line. Also large companies who make this items will need to ramp up production to meet the increased demand. This will lead to more employment, which will lead to employment tax (PAYE) for government. As these companies make more profit due to increased demand, they will pay more Company Income Tax (CIT) to government.

Also, most of these monies will find its way into the banking system, thereby increasing the bank's capacity to lend. These extra lending to companies will help companies increase their production leading to more profit and more tax to government. As banks make more money, they will also pay more tax to the government.

So, consumption can increase a country's GDP. Infact, the US economy is driven by 70% consumption, that is why the government does everything to support welfare programs and employment.