.Nigeria will post a budget deficit this year equivalent to 6.1 percent of gross domestic product after revenue missed forecasts, Finance Minister Olusegun Aganga said.

Expenditure is estimated at 5.16 trillion naira ($34.2 billion) and revenue at 3.18 trillion naira, Aganga said today at a briefing in Abuja, the capital. There were shortfalls in both oil and non-oil revenue, he said.

Nigeria’s parliament in July approved a 4.67 trillion-naira budget after making additions and other changes. The revision followed a drop in oil prices and additional expenditures to cover increased pay and expenses related to next year’s election. The country, Africa’s most populous and the continent’s top oil producer, derives more than 80 percent of its revenue from the sale of crude.

In an effort to protect domestic manufacturers and boost revenue, the country will be imposing tariffs on goods previously prohibited from being imported, Aganga said. Duties ranging from 30 percent to 40 percent will be imposed on products including furniture, textiles and drinks, he said.

The ban on the items was “ineffective,” and led to smuggling from neighboring countries that meant the government lost revenue, he said.

Part of the proceeds from the tariffs will be used to fund the state-owned Bank of Industries, which lends to small businesses, Aganga said. Some of it will also be used to support the textile industry.

Aganga also said he expects the sovereign wealth fund that Nigeria plans to establish for investing savings during periods of high oil revenue to become operational before the end of the tenure of the current government in May next year.

Nigeria will use $1 billion to start the fund, which Aganga said may improve the country’s rating with Fitch Ratings. The agency lowered its outlook on Nigeria’s BB- credit rating to “negative” from “stable” on Oct. 22, concerned about withdrawals from the excess crude account and a drop in foreign currency reserves.

http://www.bloomberg.com/news/2010-11-29/nigeria-targets-2010-budget-deficit-of-6-1-aganga-says.html