President Muhamadu Buhari has revealed that the federal government put forward a stimulus plan of N2.3 trillion to avert an economic disaster that could last for years as a result of the outbreak of the COVID-19 pandemic.
The president further disclosed that the economic agenda put in place by his government to stop the country’s economic downturn in the aftermath of the pandemic was still on course, noting that the damage done to the economy by the pandemic and the global lockdown was enormous.
Speaking in Jos, the Plateau State capital yesterday during the graduation ceremony for Senior Executive Course (SEC) 43 participants of the National Institute for Policy and Strategic Studies (NIPSS), the president, who was represented by Vice President Yemi Osinbajo said that Nigeria was in talks with the World Bank to raise $30 million to establish bio vaccine plants in the country to facilitate local production of the COVID-19 vaccine.
He lamented the scale of the damage done to the Nigerian economy, noting that the country’s GDP contracted to 6.10 per cent during the second quarter of 2020, even as oil price at one point went down to as low as about $10 per barrel before it finally settled at about $45 per barrel during the second quarter of 2020.
“Unemployment went up to 33.3 per cent in the fourth quarter of 2020. The transportation sector declined by 49 per cent, the hospitality sector fell 40 per cent, the education sector fell 24 per cent, real estate declined by 22 per cent, trade declined by 17 per cent and construction declined by 40 per cent.
“Nigeria was in a terrible economic situation and response, the President took two swift steps; One was to set up a small inter-ministerial Committee headed by the Minister of Finance, Zainab Shamsuna Ahmed, to quickly work out the implications and the immediate mitigation for the economic shocks we were headed for,” Buhari explained.
Osinbajo, who spoke specifically on what President Buhari did to avert economic disaster stated that the “second thing the president did swiftly was to direct a team of ministers and inter-agency heads to draw up a 12-month economic emergency plan, which became known as the Economic Sustainability Plan.
“We were clear that the only way of avoiding an economic disaster that could last for years was for the government to essentially put forward a major fiscal stimulus plan. Such a plan must have clear objectives of saving jobs and creating new ones, supporting businesses that may close down, and employees that may not be paid during lockdowns, and, of course, healthcare support to reduce the COVID-19 caseload. So we promptly put forward a stimulus plan in the order of N2.3 trillion,” he explained.
According to him, “We took quick fiscal measures including Grant of additional moratorium of one year on CBN intervention facilities; reduction in the interest rate on intervention facilities from nine to five per cent; grant of regulatory forbearance to banks to give borrowers some breathing space, including through restructuring of outstanding debts.
“The CBN also reports the disbursement of N798billion to 3.9million smallholder farmers under the Anchor Borrowers Programme, N134.6 billion to 38,140 beneficiaries under AGSMEIS and N343billion to 726,158 beneficiaries, the release of N1trillion to 269 real sector projects, and N103billion disbursed to 110 healthcare projects,” he added.
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The president said that the main fiscal policy challenge facing Nigeria was inadequate revenues especially in the face of lower oil revenues.
He said it was essential to improve tax administration, vigorous collection of all revenues due to the federal government from its Ministries, Departments, and Agencies; bring all high earning agencies into the federal budget. Concurrently, we must lower customs duties and tariffs on raw materials and intermediate goods used in manufacturing while giving reciprocal, non-tariff-based support like procurement, subsidies, and tax breaks to priority sectors.
He charged the new graduands to team up with his administration to build a better future for Nigerians.
Earlier, the Director-General of NIPSS, Brigadier General Chukwuemeka Udaya (rtd), said that 85 Senior Executive Course participants passed out during the graduation ceremony.
He said that the participants toured 14 states within Nigeria and also visited six African countries and five countries outside the continent in the course of the Senior Executive Course which began in February 2021.
He added that the participants had been well equipped through rigorous and intense research and training processes to contribute to the Nigerians government’s strategic plans and actions towards getting things done in their different roles and capacities.Governor Simon Lalong of Plateau State and the Sultan of Sokoto, Muhammdu Sa’ad Abubakar, were among other dignitaries that attended the graduation ceremony.
