Wale Edun, the Minister of Finance, confirmed the AfreximBank loan to the Federal Government to Arise TV, said it is the first tranche of the $3.3bn facility from the bank.

He noted that the loan was aimed at resolving the acute FX shortage that has hampered the economy.

According to the report monitored by our correspondent, the balance of $1.05bn will be received in the first week of January.

Edun stated that work has commenced for solutions to Nigeria’s economic challenges.

In August, the Nigerian National Petroleum Company Limited announced that it had secured a $3bn emergency loan from the AfreximBank to stabilise the country’s volatile foreign exchange market.

After the NEC meeting at the Presidential Villa in Abuja, Thursday, which was presided over by Vice President Yemi Osinbajo, Minister of Finance, Budget, and National Planning, Mrs. Zainab Ahmed, made this announcement while briefing State House reporters.

Because the Petroleum Industry Act, or PIA, and the 2023 budget had previously allowed for the withdrawal of the subsidy, she said that it would probably go into effect in June. As a result, any delay might necessitate amending the PIA and the budget provision, Vanguard reported.

The Minister, however, said that there was no deadline given for the subsidy removal and that the incoming administration will decide on when possible to do that.

A few weeks ago, the Federal Government said it had secured the sum of $800 million from the World Bank, as part of its post-subsidy palliative plans.

Should Nigeria forge ahead to remove the subsidy, fuel prices in Nigeria would be sold between N360 and N400 per litre after the removal of the petroleum subsidy by the government.

The Federal Government January had hinted at stopping the payment of fuel subsidies by the end of June 2023

Zainab Ahmed, Minister of Finance, Budget, and National Planning, announced on Wednesday that $800 million is the first tranche of palliatives to be disbursed through cash transfers to about 50 million Nigerians to the most vulnerable category of society.

“We made that provision to enable us to exit fuel subsidies by June 2023 when we were working on the 2023 Medium Term Expenditure Framework and the Appropriation Act,” she says.

We’re on track, we’re engaging various stakeholders, and we’ve secured some World Bank funding. That is the first tranche of palliatives that will allow us to provide cash transfers to our society’s most vulnerable members, who have now been registered in a national social register.

“Today, that register has a list of 10 million households.” Ten million households are equivalent to about 50 million Nigerians.

Cushioning the Effects of Subsidy Removal

The Finance Minister said there are plans to go beyond cash transfers to cushion the effect the subsidy removal will have on Nigerians.

Her words: “We also have to raise more resources to enable us to do more than just the cash transfers, and also in our engagements with the various stakeholders, the various kinds of tasks that we have to go beyond the requirement of just giving cash transfers. Labor, for example, might be looking for mass transit for its members.

“So there are several things that we’re still planning and working on, some we can start executing quickly, and some are more medium-term implementations.”

Ahmed said: “$800 million for the scale-up of the National Social Investment Programme at the World Bank, and it’s secured, ready for this disbursement.”