October 21, 2021

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WRIGGLING OUT OF COVID-19: Total Palliative Package for Nigerian Businesses, 1.5% of GDP

3 min read

Prof. Yemi Oshinbajo, Nigeria’s Vice President

The Federal Government has announced that the much touted stimulus being expected to reinvigorate the nation’s commerce and industries from the depths of misery COVID-19 pandemic has consigned the economy, is just a paltry 1.5% of the nation’s GDP which translates toN2.3trillion

Professor Yemi Osinbajo, the Vice President, revealed the principle guiding the federal government on the amount to funding palliative packages for the entire sectors in the national economy; aviation, tourism, and hospitality inclusive.

The Vice President made the call at the virtual edition of the Presidential Policy Dialogue of the Lagos Chamber of Commerce and Industry (LCCI).

Oshinbajo explained, “the stimulus package is just about 1.5% of GDP, it is the best the government could do given existing realities in the economy”.

He said “government developed the Economic Sustainability Plan with a stimulus package of N2.3trillion to give fillip to the economy across various sectors”.

The Vice President appealed that, “the size of this stimulus which is just about 1.5% of national income is not as large as we would have liked it to be but it was the best we could do given existing fiscal and monetary constraints”.

He explained further the parameters for deciding the total amount of the palliative as, “based on the assumption of the price of crude averaging out at $30 per barrel throughout the year, we anticipate an economic growth of about -0.59% in 2020”.

He said the, “Economic Sustainability Plan (ESP) is to encourage the private sector to lead the charge for Nigeria’s economic growth and development as being implemented by the Buhari administration and is being driven by the desire to adapt to the challenges and make required changes in order to come out stronger than before”.

The nation’s number two citizens gave objective of government for the palliative as, “the priority of the Federal Government in response to the economic challenges caused by COVID-19 is to ward off a deep recession by an admixture of stimulus measures to support local businesses, retain and create jobs and ameliorate the circumstances of the most vulnerable”

On the ease of doing business, Oshinbajo a Professor of law disclosed that, “In this regard, we have made some strides in improving the ease of doing business in Nigeria. Through the Presidential Enabling Business Environment Council (PEBEC), a lot has been achieved to fast-track processes, reduce bottlenecks and improve transparency across Government MDAs.

He noted that, “As a result, we have moved 35 places upward in the World Bank’s Ease of Doing Business rankings. We have continued to scale up our business reform initiatives across regulatory agencies.

He however noted that, “there is still a lot more to be done. 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,” the Vice President added.

While making his remark, the Minister of Industry, Trade and Investment, Otunba Niyi Adebayo, said the current focus of the Federal Government in the manufacturing sector “is on prioritizing local production especially in the importation of machinery that utilize local materials.”

Earlier, the President, Lagos Chambers of Commerce, LCCI, Mrs Toki Mabogunje, commended the Federal Government’s “spirited effort” regarding the manner Nigerian economy is being managed, adding that members of the chamber’s and private sector players are willing to collaborate with the Buhari administration.

various players in Aviation, Hospitality, Tourism, Road transport, and Water transport among others are anxiously waiting for the actualization of the much touted stimulus promised by the federal government. No iota of doubt that, the travel industry has been exceptionally hit by the devastating effect of the COVID-19. Hotels have also not received guest for about six months now while the tourist centers continue to experience zero patronage.

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