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FG’s N2.3trn stimulus package will  reflate economy, boost production, prevent business collapse –  Osinbajo

…lauds LCCI for its valuable contributions to public policy discourse

VP Prof Yemi Osinbajo

 

The Federal Government says its Economic Sustainability Plan with a stimulus package of N2.3 trillion will give fillip to the economy, boost production, prevent business collapse and provide liquidity.

 

The Vice-President, Prof. Yemi Osinbajo said on Friday at the virtual edition of the 2020 Presidential Policy Dialogue of the Lagos Chamber of Commerce and Industry (LCCI).

He said the size of the stimulus is about 1.5 per cent of national income or GDP, noting that it is not as large as the government would have wanted it to be.

 

“But it is the best we could do given existing fiscal and monetary constraints, and this is also based on the assumption that the price of crude will average around 30 to 40 dollars per barrel throughout the year. We anticipate an economic growth of about -0.59% in 2020.

“You would already be familiar with details of the Economic Sustainability Plan. In essence it is intended to boost production, prevent business collapse, and provide liquidity.

 

“It will also promote the use of labor-intensive methods and direct labour interventions in key areas like agriculture, light manufacturing, housing construction and facility maintenance while increasing infrastructural investment in roads, bridges, solar power, and communications technologies.

“It is intended to do all this while extending protection to the poor and other vulnerable groups in our society which of course means that we will be strengthening our social investment programmes and the social safety nets that we have created in the past four years,’’ Osinbajo said in a statement by his media aide, Mr Laolu Akande, a copy of which was obtained by Persecondnews.

Nigeria, he noted, like all other countries had been quite seriously impacted in various ways by the COVID-19 pandemic and it has affected everyone as households or as businesses.

Osinbajo said since the pandemic and its effects would linger for sometime it had become imperative adapt to it and adopt new ways of doing things.

The Vice-President said: “So it is for what we are doing today. Of course, we used to meet physically, now we must deploy technology and meet electronically. In some ways, we have become efficient and effective, we are deploying far less time and resources to generate similar, if not better impact and outcomes, so there is a silver lining somewhere in these dark clouds.

“I must say that the LCCI, with its rich history since 1888 is probably the only indigenous organization of its kind to have been through a global pandemic like the Spanish influenza of 1918-1920. So, I think we must have a few questions about how you coped then, you are probably the ones who can give us any advice on how to cope now.

“But quite seriously, the fact that industry and businesses survived even in those early days with all the difficulties, surely must teach us something and the spirit of innovation, the spirit of being creative even in the most difficult times catches the essence of our approach to the challenges of the current situation.

“The priority of the Federal Government in response to the economic challenges posed by COVID-19 is essentially to ward off a deep recession and to save jobs and this we are hoping to do by a mixture of stimulus measures to support local businesses; the essence being to retain jobs and to ensure that we create the best possible circumstances for the most vulnerable in the society.’’

Osinbajo lauded the Chamber’s consistency in championing issues and in making valuable contributions to public policy discourse as well as positive spirit of engagement in the joint endeavor to promote national development.
He outlined areas covered by the plan including economic and social sectors, saying the government is targeting about five million jobs in the agricultural sector.

“In it, there are opportunities for small-scale farmers just as there are for large scale out-growers. There are opportunities for seed companies just as there are opportunities for companies engaged in land clearing.

“Indeed, producers and manufacturers of fertilisers, insecticides, herbicides and leasers of tractors and harvesters are factored into the agricultural intervention just as transporters, commodity exchanges and processors will find lots of opportunities for expansion.

“The key constraints in the agricultural value chain such as lack of access to financing and post-harvest losses will be overcomed because of the involvement of banks and large off-takers. The Federal Government will be the ultimate purchaser of produce for use in various programmes like the Home Grown School Feeding Programme and the Strategic Grains Reserve.’’

Osinbajo also said MSMEs which are the backbone of the economy to promote local production of pharmaceuticals and COVID-19 essentials like personal protective equipment, face masks, face shields, hand sanitisers and others were being supported.

According to Osinbajo, a valuable insight got from the COVID-19 pandemic is the key role of digital technology in economic activity going forward.

 

He stressed :“Access to broadband facilities is key for software development, digital education, e-commerce, e-health, e-government, internet banking, and even video conferences such as this one.
“Broadband facilities are also vital if Nigeria is to be well positioned to take advantage of cutting edge developments in robotics, 3-D manufacturing, artificial intelligence and smart devices including cars.

 

“Improved broadband coverage will also open up opportunities in other sectors of the economy including cloud platforms, digital financial services and digital skills and training. This is why in the Economic Sustainability Plan, we have paid attention to total national broadband coverage which is a core issue the Federal Government wishes to undertake as robustly as possible.

“Our aim is to continue to improve our national ranking in the World Bank Doing Business Index Ranking to below 100 in the coming years. It is also very important to reduce the harassment and extortion of businesses by various government agencies.’’

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