Review your Economic Policies Amidst Present challenges, FG tells Governors
In line with Federal Government’s desire to address challenges posed by Covid-19 pandemic in Nigeria, a number of State Governments across the country have reviewed their 2020 budget to align with present realities.
Many States have also begun adopting measures for aggressive diversification of their revenue base, to reduce dependency on the diminishing allocations from the Federation Account.
The Minister of State, Budget and National Planning, Prince Ikanade Agba, made this known during the 11th virtual Community of Practice (CoP) meeting of Commissioners of Economic Planning, held in Abuja, with the theme: “COVID-19: Strategies for quick Recovery of the Economy”
Agba noted that, though there had been marginal increase in the price of crude oil in the international market, the cut in daily production quota by OPEC still dwarfed the much-required revenue needed to rejig the weakened economy.
Also, as a result of the rising rate of infections, the continuous global melt, the increasing unemployment on account of layoffs in all sectors of economy, the Minister said, the economic growth could contract to about -8.9% in 2020, in the worst-case scenario and -4.45 in the best-case scenario without any form of stimulus to the economy.
To prevent a potential deep recession, accelerate quick recovery of the economy and carry on with the estimated stimulus package, the Minister announced that the current total estimated stimulus package by the Federal Government of Nigeria was N2.3 trillion.
This package, according to Agba, consisted of N500Billion FGN interventions fund, N1.2T CBN intervention funds, N334B BOI/Bilateral/Multilateral interventions and additional FGN support of N300B. “A common feature of these interventions is that they would create a large number of jobs, empower farmers and entrepreneurs, use up to 100% of local materials, conserve foreign exchange and have guaranteed offtake of outputs, especially in agriculture and housing.”
He also said that Federal government was taking steps to increase non-oil revenue generation through VAT reforms in the Finance Act 2020, customs administration enhancement, tax incentives and exemptions, increase remittances and recovery of unremitted revenues from GOEs, increase revenues from cross-border business transactions, unlock value from FG assets that were lying idle or under-utilized, etc.
Agba therefore urged States to emulate the economic recovery steps taken by the Federal government by coming up with more policy options for a quick recovery of the economy with the following measures in mind: Adopt a targeted and integrated policy response; Deal decisively and proactively with public health safety issues; Consider a new 2020 budget across the States to reflect new realities and develop sectorial responses that addresses immediate needs, among others.
Earlier in her remarks, the Permanent Secretary, Budget and National Planning, Mrs. Olusola Idowu, said that the meeting was very significant as it provided participants with the opportunity to chart a new course towards the development of the country amidst the COVID-19 pandemic. “Together, we will strive towards addressing the challenges posed by the novel corona virus pandemic’’ Idowu stressed.
She appreciated various presenters, panelists, State Commissioners and other attendees saying that the dialogue was a springboard to develop workable solutions for the national economic challenge.
Dignitaries at the meeting were: DG Small and Medium Enterprise Development Agencies of Nigeria (SMEDAN), Dr. Dikko Umaru Radda, Executive Director/CEO, Nigerian Export Promotion Council (NEPC), Mr. Olusegun Awoloowo, CEO Bank of Industry, Mr. Olukayode Pitan and National Programme Manager, DFID-PERL, Ifeanyi Peters Ugwuoke, among others.