In a bid to mitigate the spread and the negative economic effect of the COVID-19 outbreak, several policy initiatives have been introduced by the Federal Government of Nigeria (FG) and other key authorities. Notably, areas of focus have been centered on beefing up healthcare facilities, providing credit and other expansionary measures. As part of our COVID-19 series, we highlight the recent policy measures announced.
Recently, the Minister of Finance, Budget and National Planning disclosed the government’s plan to accumulate a total of $7.05bn in response to the COVID-19 outbreak. Of the $7.05bn, $3.4bn is to be sourced from the country’s contributions to the IMF, $2.5bn from World Bank, $1.0bn from the AfDB and $150mn from the Nigerian Sovereign Investment Authority. In addition, the FG established an N500bn COVID-19 Crisis Intervention Fund to upgrade healthcare facilities and expand the ongoing ‘Special Public Works Programme’. Furthermore, the NCDC plans to draw down a balance of $82.0mn from a Regional Disease Surveillance Systems (REDISSE) facility provided by the World Bank, and request for an additional $100.0mn. Other policies from the government include a 3-month moratorium on government loans (Tradermoni, BOA, BOI, etc), conditional cash transfers within 2 months to the poor and vulnerable and N15.0bn allocated to Lagos state and NCDC. Finally, the FG suspended debt interest payments by states, to enhance their liquidity positions to fight the outbreak.
Elsewhere, the CBN rolled out a 1-year extension on all CBN intervention facilities, interest rate reduction from 9% to 5%, an N50bn credit facility for households and SMEs, regulatory forbearance, an N1.1t n intervention for healthcare and manufacturing, and strengthening of the LDR policy. In addition, the CBN alongside other stakeholders created the ‘Nigeria Private Sector Coalition against COVID-19. In all, we expect more policy actions in the coming weeks by these authorities, to ensure the Nigerian economy stays afloat this period.
United Capital Research
