Business News
Nigeria needs $100 billion annually to fix infrastructural deficit – Finance Minister
Nigeria needs an estimated sum of $100 billion or N36 trillion annually to address the infrastructural decay in the country.
Nigeria needs an estimated sum of $100 billion or N36 trillion annually to address the infrastructural decay in the country.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, reportedly disclosed this on Monday at a workshop on ‘Maximizing finance for the development of infrastructure in Nigeria’, organised by the World Bank Group in Abuja’.
[READ MORE: Nigeria spends N1.9 trillion on goods from China in H1, up by 88%]
The details: According to the minister, the Federal Government will require about $100 billion annually for the next 30 years to effectively tackle Nigeria’s infrastructure challenges. Mrs Zainab further stated that with the shortfall in oil revenue, which has plummeted in recent times, it is difficult to address infrastructural deficit.
“Nigeria requires an estimated sum of $3tn to bridge its infrastructure gap over a 30-year period. This amounts to roughly $100bn per year, with a total federal budget of less than $30bn for 2019 and the dependency of Nigeria’s income on oil revenue with unpredictable global price fluctuation, Nigeria no doubt lacks the fiscal space to self-finance the required infrastructure investment,” the minister stated.
Speaking further, she said the time had come for the government to start looking for alternative sources of funding infrastructure as budgetary funding alone could not address the funding gap.
World Bank’s Interventions: Meanwhile, while the World Bank acknowledged that Nigeria faces a $100 billion annual investment gap in infrastructure, the bank has pledged to assist Nigeria close the infrastructure gap.
According to Mr Hafez Ghanem, the World Bank Vice President for Africa, the bank can, together with the private sector, leverage government resources to bridge infrastructure gaps in Nigeria.
“We have supported and seen success in transport, energy and power sectors using Public-Private Partnerships (PPPs) models. The Azura power project is an example of how we have attracted private sector investment in the power sector.
“We are happy to work with the Government of Nigeria on power sector reforms, which will create a better environment to attract more private sector financing,” Ghanem said.
Mr Sérgio Pimenta, Vice President of IFC (a sister organization of the World Bank) for the Middle-East and Africa, said that private sector resources and expertise could go a long way in bridging the gap.
“In Sub-Saharan Africa, we are increasingly seeing the private sector design sustainable business models that are creating jobs and lifting people out of poverty. The World Bank Group’s institutions will work together to mobilise a range of financing solutions (both private and public) for projects in developing countries,” he said.
[READ ALSO: Energy: Nigeria to receive $500,000 grant]
What it means: Last week, Nairametrics reported that Nigeria approached the World Bank for another loan to the tune of $2.5 billion or N767.3 billion in a new tranche of concessionary lending. According to the report, World Bank Vice President for Africa stated this in an interview.
Huge infrastructural gap in Nigeria still persists, and all indications point to the fact that Federal government of Nigeria may still settle for further loans from the world bank to brighten any chance of bridging the age-long infrastructural decay.
Economy & Politics
BREAKING: Buhari sacks Service Chiefs, appoints new
President Buhari has appointed new Service Chiefs to replace the former with immediate effect.
President Muhammadu Buhari has appointed new Military Service Chiefs, and congratulates the outgoing Service Chiefs for efforts of “enduring peace to the country.”
This was disclosed by Presidential media aide, Femi Adesina in a social media post on Tuesday. President Buhari has been urged by the National Assembly to sack Service Chiefs over rising insecurity in the county.
Adesina said: “PMB appoints new Service Chiefs. Maj Gen LEO Irabor, CDS, Maj Gen I Attahiru, Army, Rear Adm AZ Gambo, Navy, AVM IO Amao, Air Force. He congratulates outgoing Service Chiefs on efforts to bring enduring peace to the country.”
“I have accepted the immediate resignation of the Service Chiefs, and their retirement from service. I thank them all for their overwhelming achievements in our efforts at bringing enduring peace to Nigeria, and wish them well in their future endeavours,” Buhari disclosed in a separate statement.
I have also appointed new Service Chiefs, to replace the retired officers:
Major-General Leo Irabor, Chief of Defence Staff
Major-General I. Attahiru, Chief of Army Staff
Rear Admiral A.Z Gambo, Chief of Naval Staff
Air-Vice Marshal I.O Amao, Chief of Air Staff.
— Muhammadu Buhari (@MBuhari) January 26, 2021
What you should know: President Buhari had come under heavy criticism in the last couple of years over his failure to sack the Service Chiefs for failing to tackle insecurity in the country.
Macro-Economic News
BREAKING: CBN retains MPR at 11.5%, holds other parameters constant
The CBN voted unanimously to keep the Monetary Policy Rate (MPR), at 11.5% and other parameters constant.
The Monetary Policy Committee (MPC), of the Central Bank of Nigeria (CBN), has voted unanimously to retain the Monetary Policy Rate (MPR) at 11.5%
This was disclosed by Governor, CBN, Godwin Emefiele while reading the communique at the end of the MPC meeting on Tuesday 26th January 2021.
Other parameters such as Cash Reserve Ratio (CRR), Liquidity ratio, and asymmetric corridor remain unchanged.
Highlights of the Committee’s decision
- MPR retained at 11.50%
- The asymmetric corridor of +100/-700 basis points around the MPR
- CRR was retained at 27.5%
- While Liquidity Ratio was also kept at 30%
More details shortly…
Coronavirus
FG says N10 billion disbursed funds not only for Covid-19 vaccines
FG has clarified that the N10 billion it earlier disbursed was not only for the development of Covid-19 vaccines.
The Ministry of Finance, Budget and National Planning has said that the N10 billion it released for vaccine development is not only for the production of Covid-19 vaccines.
This was disclosed by the Director-General of the Budget Office, Mr. Ben Akabueze, representing the Finance Minister during a meeting with the National Assembly Joint Committee on Health on Monday, reported by NTA.
Following the announcement of the disbursement of the sum of N10 billion to the Ministry of Health for the development of Covid-19 vaccine, the Joint Committee scheduled a meeting with the Ministers of Finance and Health for clarifications on the funds.
“The joint committee is invited to note that N10 billion has been released, to the Federal Ministry of Health under the budgetary vote referenced in above,” Akabueze said.
Ibrahim Oloriegbe, Chairman, Senate Committee on health, said the Committee wanted to know what the use of the funds was for and urged against the implementation of a lockdown.
“We got to see that what was released was in line with what was already there, for preparing the country for all other vaccines arrangements
“So our economy, we only need to live with covid, we cannot with due respect, contaminate Nigeria with a lockdown, it will badly affect our economy,” Oloriegbe said.
The committee also said the total aim is to see how Nigeria can develop its capacity towards the development of vaccines,
The Joint Committee, therefore, resolved that the Minister of Health who was absent at the meeting should appear before it on Tuesday for a breakdown on the proposed use of the funds.
What you should know: Nairametrics reported last week that the Federal Government, through the Ministry of Finance, announced the sum of N10billion for the production of vaccines in Nigeria, to fight the coronavirus.
