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Economy & Politics

Private sector can catalyse investments in infrastructure and contribute to Africa’s Covid-19 recovery – UN

The United Nations has stated that the private sector can contribute crucially to post COVID-19 economic recovery.

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The United Nations has said that the private sector is the engine of growth, and can help catalyse investments in infrastructure and industrialization. It also stated that the private sector can contribute crucially to post COVID-19 economic recovery.

This was disclosed in a statement by the United Nations Economic Commission for Africa (ECA), after the launch of “Economic Report on Africa 2020: Innovative Finance for Private Sector Development in Africa” on Tuesday in Addis Ababa, Ethiopia.

Vera Songwe, Executive Secretary, ECA, said the innovative financing is a way of ensuring that Africa grew into a prosperous continent.

  • “In the report, we looked at a couple of definitions; we looked at the private sector, the Small and Medium Enterprises, the non-business financial institutions and the role of technology. We are hoping that this report will allow us, particularly after this crisis, to look at how we design financing and particularly innovative financing toward infrastructure, agriculture and technology, going forward.”

William Lugemwa, Director, ECA Private Sector Development and Finance Division, disclosed that the ECA found out economies in Africa are not diversified, citing low investments in innovation and private sector led reforms which impedes production.

  • “The private sector, as the engine of growth, can help catalyse investments in infrastructure and industrialization, and so can contribute crucially to post COVID-19 economic recovery. The digital revolution, under way in Africa currently, and mainly based on mobile phone networks, presents opportunities for scaling up alternative finance and sustainably developing private sector finance.”

Lugemwa said the ECA also noticed that capital markets, private investments, crowd-funding platforms and other alternative methods of financing were gaining momentum in Africa, even though the report still highlighted challenges affecting Africa’s private sector.

He stated that the UN forecasts Africa needs $1.3 trillion annually to funds its Sustainable Development Goals (SDGs), which would be heavily impacted by population growth. He also added that for Africa to achieve its SGDs, investments need to be made in innovative financing and increased private investments.

He added that Africa needs regulations on capital market requirements to avoid the spread of financial instability.

  • “African policymakers and regulators can put in place emergency policy measures to manage financial stability and create a sound pathway toward economic recovery.”

What you should know 

Nairametrics reported in October that The World Bank said the Sub-Saharan Africa (SSA) region is expected to experience a reversal of economic contraction next year, as countries in the region start to ease movement restrictions, even as the impact of the coronavirus will endure for years to come. The bank said that a growth of about 2.1% could follow in 2021 and 3.2% in 2022.

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Economy & Politics

Senate endorses ex-Service Chiefs as Non-career Ambassadors

The Senate has confirmed President Buhari’s nomination of the immediate past service chiefs as non-career ambassadors.

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The Nigerian Senate has endorsed the nomination of the past serving Military Service Chiefs as Non-career Ambassadors.

This was confirmed during Tuesday’s plenary session and announced in a social media statement by the Nigerian Senate.

Their confirmation follows the consideration of the report of the Senate Committee on Foreign Affairs, Chaired by Senator Adamu Bulkachuwa.

According to reports, the Senate Minority Leader Enyinaya Abaribe, however, questioned the nomination and confirmation of the ex-service chiefs when the Senate had on 3 different occasions called for their sack.

Senator Abaribe also raised issues on the petitions against the former service chiefs and questioned why they were dismissed without explanations.

But Senate President Ahmad Lawan dismissed Senator Abaribe’s concerns, ruling that the nomination of the former service chiefs cannot be nullified simply because the upper chamber had called for their sack, noting that this is totally a different assignment.

In his concluding statement, the Senate President, Senator Lawan added that these nominees that have just been confirmed have served this country to the best of their abilities. He appealed to the executive to make sure they use their experience as military men to the best.

“These nominees that we have just confirmed are nominees that have served this country to the best of their ability. Our appeal to the Executive is to make sure they use their experiences as military men to the best,” Lawan said.

Lawan, on behalf of the senate, wished them a very successful career in their capacity as Non-Career Ambassadors.

What you should know 

  • Recall Nairametrics reported earlier this month that President Muhammadu Buhari nominated ex-Service Chiefs for Senate approval as non-career Ambassadors-Designate.
  • Their appointment came barely a week after their retirement as service chiefs and their replacement with new ones.
  • This led to a spate of criticisms from some Nigerians who felt that the nation’s security situation got worse under their watch.
  • They were reported to have tendered their resignation from their positions amid heightened calls that they should be sacked due to the increasing rate of insecurity across the country.

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Economy & Politics

2020 budget performance: FG achieves 89% capital release in December 2020

The Minister of Finance has revealed that the FG achieved 89% release of the capital component of the 2020 budget to MDAs as of December 2020.

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The Minister of Finance, Budget and National Planning, Zainab Ahmed, has revealed that the Federal Government achieved 89% release of the capital component of the 2020 budget to Ministries, Departments and Agencies (MDAs) as of December 2020.

She said that the 89% capital funding for MDAs was achieved with the release of N1.74 trillion.

According to a report by the News Agency of Nigeria (NAN), this disclosure was made by Ahmed at an interactive session with the leadership of the National Assembly on Monday, February 22, 2021.

She also revealed that the government had disbursed N118.37 billion for Covid-19 capital expenditure from the fund.

READ: Recession: Senate attributes recovery to it’s cordial relationship with Executive

What the Minister for Finance is saying

Ahmed said the Nigerian economy faced serious challenges in 2020, with the macroeconomic environment significantly disrupted by the Covid-19 pandemic.

She said this led to a 65% drop in projected net 2020 government revenues from the oil and gas sector, which adversely affected foreign exchange inflows into the economy.

On the delayed release of funds to implement the 2020 capital budget until March 31, the Minister said the complaint had decreased.

She said, “I think the complaint was earlier in the year when we were trying to transfer the balances. As far as I know, in the past three weeks, I haven’t heard any such complaints and we have been able to address them.

“But when we started the transfers, we couldn’t transfer to some agencies because of some limitations in the system, but we have since been able to transfer the capital component that is being utilised by the agencies budget to the system.

READ: Nigeria receives $9.68 billion capital inflows in 2020, lowest in 4 years

While pointing out that the implementation of the MDAs projects was tied to procurement processes and capacity of the MDA, Ahmed also said the extension of the 2020 capital budget implementation to March 31 had recorded 30% performance as at January.

However, Ahmed said that she expected that the extension would record 100% performance in March.

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Speaking during the interaction, the Senate’s Chief Whip, Senator Orji-Uzor Kalu, commended the Minister on the capital performance of the 2020 budget.

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READ: FG to reopen Kano and Port Harcourt airports for international flights

He said, “I want to commend the minister and her team because this is the first time in the history of Nigeria that by December 31, we are having 89% performance expenditure of the budget. It has never happened before; Last year was the very first.

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“The budget had been going 49%, 27%; this means from what the Senate President was asking, it means by March, we should be looking at implementing the budget 100%.’

Earlier, President of the Senate, Ahmad Lawan said the meeting was to get an update on the capital implementation of the 2020 budget given its extension for implementation by the national assembly to March 31.

What this means

  • The 89% capital release for the 2020 budget as of December 2020 is quite encouraging as it occurred despite the economic challenges and disruption caused by the outbreak of the coronavirus pandemic.
  • There seems to be an improved effort by the Federal Government at the budgeting process with the early passage of the 2021 budget and the implementation of the capital component of the 2020 budget.

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