The minister of finance, Mrs Zainab Ahmed, disclosed at the inauguration of the committee on Nigeria covid-19 action recovery for economic stimulus ( N- cares), in Abuja, that the federal government is currently processing a $750 Million loan from the world Bank for states governments to address the impacts of the covid-19 pandemic among the populace.
She said that the administration was determined to assuage the impacts of the COVID-19 on low-income earners who form the bulk of the Nigerian population.
Her words, “The diverse and severe impacts of the COVID-19 pandemic continue to be felt across the world with significant consequences on informal businesses, and households that survive on daily income and the peasant farmers who depend on their farm produce to survive.
“This key population make up over 60% of our entire population in Nigeria therefore, the need to cushion the effects of the pandemic on the vulnerable sectors through the provision of palliatives and stimulus package.
“As part of windows of opportunity to mitigate the effect of Covid-19, the Federal Government is in the process of accessing a World Bank loan of $750 million on behalf of the states to stimulate the local economy and support vulnerable household’s consumption.”
Can’t afford civil unrest
Mrs. Ahmed said that the administration would take every necessary step to ensure that the nation’s economy did not remain in recession because of its consequences.
According to her, “Nigeria as the biggest economy in Africa cannot afford to remain in recession; the survival of over 200 million population is germane to all we do and we must address the concerns of the majority of our populace.
“Let me remind you that the consequences will be too high if we ignore the root cause of rising civil unrest in our country. We must therefore, fashion out ways of ensuring that post Covid-19 is not injurious to the Nigerian people and the economy.”
How transportation pushes up inflation
Meanwhile Mrs. Ahmed has identified the cost of transportation, which is directly linked to fuel price hikes, as a major driver of inflation in the country.
The minister spoke during a virtual stakeholders engagement to discuss the economic and fiscal policy drivers underpinning the Finance Bill 2021, yesterday.
Her words, “If you look at the rate at which our inflation is going, and you disaggregate the components, you will find that inflation is largely driven by transport cost. So, the essence here is to reduce transportation cost so that businesses will have ease and pass benefits to eventual consumers.”
She added that the federal government recognised transportation as one of the major cost drivers in the economy and would therefore implement policies that would reduce the cost of transportation.
There have been a steady fuel price increase since the federal government completely removed subsidy on petroleum products in April.
Marketers increased pump price of Premium Motor Spirit (PMS) popularly called petrol by about N7.5 per liter, yesterday.
It was an indication that inflation rate could significantly increase in the days ahead.