President Ahmed Tinubu on Monday, July 31 2023 unveiled his government’s investment plans amounting to NGN 500 billion. The investments, he said, are to cushion the harsh economic impacts of fuel subsidy removal and the harmonization of the foreign exchange windows.
Already, the policies are taking tolls on companies with the likes of Airtel and MTN having their forex reserves depreciating.
The President who pleaded with the citizens to understand the reasons for the policy measures his government have taken to combat the serious economic challenges the nation has long faced, said that for several years, he consistently maintained the position that the fuel subsidy had to go.
“This once beneficial measure had outlived its usefulness. The subsidy cost us trillions of Naira yearly. Such a vast sum of money would have been better spent on public transportation, healthcare, schools, housing and even national security. Instead, it was being funnelled into the deep pockets and lavish bank accounts of a select group of individuals….
“Also, the multiple exchange rate system that had been established became nothing but a highway of currency speculation. It diverted money that should have been used to create jobs, build factories and businesses for millions of people. Our national wealth was doled on favourable terms to a handful of people who have been made filthy rich simply by moving money from one hand to another. This too was extremely unfair.
“It also compounded the threat that the illicit and mass accumulation of money posed to the future of our democratic system and its economy.
The Tinubu acknowledged that the economy is going through a tough patch and the citizens are being hurt by it. “The cost of fuel has gone up. Food and other prices have followed it. Households and businesses struggle. Things seem anxious and uncertain. I understand the hardship you face. I wish there were other ways. But there is not. If there were, I would have taken that route as I came here to help not hurt the people and nation that I love”.
He rolled out plans to cushion the effects:
Manufacturing sector to receive NGN75 billion
To strengthen the manufacturing sector, increase its capacity to expand and create good paying jobs, the President said his administration is “going to spend NGN75 billion between July 2023 and March 2024.
Our objective is to fund 75 enterprises with great potential to kick-start a sustainable economic growth, accelerate structural transformation and improve productivity”.
Each of the 75 manufacturing enterprises, he said, will be able to access NGN1billion credit at 9% per annum with maximum of 60 months repayment for long term loans and 12 months for working capital.
MSMEs to receive NGN125 billion
“Our administration recognises the importance of micro, small and medium-sized enterprises and the informal sector as drivers of growth. We are going to energise this very important sector with N125 billion.
Out of the sum, the Federal Government will spend N50 billion on Conditional Grant to 1 million nano businesses between now and March 2024.
“Our target is to give NGN50,000 each to 1,300 nano business owners in each of the 774 local governments across the country”, Tinubu said.
“Ultimately, this programme will further drive financial inclusion by onboarding beneficiaries into the formal banking system. In like manner, we will fund 100,000 MSMEs and start-ups with N75 billion. Under this scheme, each enterprise promoter will be able to get between NGN500,000 to NGN1million at 9% interest per annum and a repayment period of 36 months.
Release of 200,000 Metric Tonnes of grains
“To further ensure that prices of food items remain affordable, we have had a multi-stakeholder engagement with various farmers’ associations and operators within the agricultural value chain.
“In the short and immediate terms, we will ensure staple foods are available and affordable. To this end, I have ordered release of 200,000 Metric Tonnes of grains from strategic reserves to households across the 36 states and FCT to moderate prices. We are also providing 225,000 metric tonnes of fertilizer, seedlings and other inputs to farmers who are committed to our food security agenda.
Agricultural investments worth NGN 200 billion
“Our plan to support cultivation of 500,000 hectares of farmland and all-year-round farming practice remains on course. To be specific, N200 billion out of the NGN500 billion approved by the National Assembly will be disbursed as follows:
- Our administration will invest NGN50 billion each to cultivate 150,000 hectares of rice and maize.
- NGN50 billion each will also be earmarked to cultivate 100,000 hectares of wheat and cassava.
This expansive agricultural programme will be implemented targeting small-holder farmers and leveraging large-scale private sector players in the agric-business with strong performance record.
In this regard, he said that the expertise of Development Finance Institutions, commercial banks and microfinance banks will be tapped into to develop a viable and an appropriate transaction structure for all stakeholders.
Tinubu’s Transportation Investment plan – NGN 100 billion
“Part of our programme is to roll out buses across the states and local governments for mass transit at a much more affordable rate. We have made provision to invest NGN100 billion between now and March 2024 to acquire 3000 units of 20-seater CNG-fuelled buses.
“These buses will be shared to major transportation companies in the states, using the intensity of travel per capital. Participating transport companies will be able to access credit under this facility at 9% per annum with 60 months repayment period.
New minimum wage is coming
“In the same vein, we are also working in collaboration with the Labour unions to introduce a new national minimum wage for workers. I want to tell our workers this: your salary review is coming”.
He said that once they agree on the new minimum wage and general upward review, the government will make budget provision for it for immediate implementation.
He applauded many private employers in the Organised Private Sector who have already implemented general salary review for employees.
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