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18 States Worse Hit By Poverty – AfDB

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Poverty rate in more than half of the 36 states of the nation is above the national average of 69 per cent, the African Development Bank has said.
The bank said this in its African Economic Outlook 2020 obtained by The Tide, recently.
The bank said that poverty was widespread in the country, adding that the national poverty rate was 69 per cent of the population.
This means that out of the country’s reported 180 million people, 124.2 million people live in poverty.
With more than 50 per cent of the nation’s 36 states having a poverty rate above the national average of 69 per cent, it means that the poverty levels in these states, which the bank did not mention, are even worse.
The report said, “Poverty remains widespread. The poverty rate in over half of Nigeria’s 36 states is above the national average of 69 per cent.
“High poverty reflects rising unemployment, estimated at 23.1 per cent in 2018, up from 14.2 per cent in 2016. Low skills limit opportunities for employment in the formal economy.
“Government social programmes – N-Power and other youth empowerment schemes – are meant to address unemployment.”
According to the bank, Nigeria spent more than 50 per cent of federally-collected revenues on debt servicing in 2019.
On the performance of Nigeria’s economy in 2019, the bank noted that agricultural sector suffered a setback due to flooding and conflicts between herdsmen and farmers.
It, however, reported that the country saw growth in the transport, oil and Information and Communications Technology sectors.
The report said, “Real Gross Domestic Product growth was estimated at 2.3 per cent in 2019, marginally higher than 1.9 per cent in 2018.
“Growth was mainly in transport, an improved oil sector and Information and Communications Technology.  Agriculture was hurt by sporadic flooding and by conflicts between herdsmen and local farmers.
“Manufacturing continues to suffer from a lack of financing. Final household consumption was the key driver of growth in 2019, reinforcing its 1.1 per cent contribution to real GDP growth in 2018.
“The effort to lower inflation to the six to nine per cent range faced structural and macroeconomic constraints, including rising food prices and arrears payments, resulting in a rate estimated at 11.3 per cent for 2019.
“With fiscal revenues below seven per cent of the GDP, increased public spending widened the deficit, financed mainly by borrowing.
“At the end of June 2019, total public debt was $83.9bn, 14.6 per cent higher than the year before. That debt represented 20.1 per cent of the GDP, up from 17.5 per cent in 2018.
“Domestic public debt amounted to $56.7bn, external public debt, $27.2bn. The share of bilateral debt in total debt was estimated at 12.1 per cent and that of Eurobonds at 40.8 per cent.
“High debt service payments, estimated at more than half of federally-collected revenues, created fiscal risks. The current account surplus sharply declined due to increased imports, lower oil revenues and a smaller-than-expected improvement in capital flows.”
The report said the Central Bank of Nigeria’s recent ‘decree’ that banks hold loan-deposit ratios of 60 per cent boded well for increasing lending to the real sector.
“Simultaneously, the retrenchment of government borrowing and  easing of the risks of lending to small business could lower interest rates and unlock bank lending to the private sector,” the report added.
It backed the increase in Value Added Tax, saying, “An increase in the value-added tax from five per cent to 7.5 per cent to shore up domestic non-oil revenues is welcome, though organised labour and businesses have raised concerns of a potential rise in costs.”
It said the current account was projected to remain in surplus in 2020, benefiting from improved oil revenues.
According to the report, Nigeria has many opportunities to transform its economy, particularly in agro-processing.

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COVID 19: ‘Lifting Of Curfew’ll Boost Rivers Economy’

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A traditional ruler in Rivers state, Eze (Dr) Sylvanus Ogbueri, has commended the Rivers State Governor, Chief Nyesom Wike, for relaxing the curfew imposed in some parts of the state capital, saying it would impact positively on the business community in the state.
Eze Ogbueri, who is the Onwa of Omuma ethnic nationality, said that the action of the governor shows that he listens to the feelings of the people, unlike most other political leaders in the country.
The monarch said that Governor Wike deserves commendation because of his exemplary actions since the advent of coronavirus.
“His swift intervention made it possible for the virus not to spread beyond the index case.
“Relaxing the curfew has given petty traders who are not affected by the lockdown to operate and find ways of providing for their families in this difficult period”, he said.
The traditional ruler urged the people of Omuma to comply with the directives of the state government aimed at curtailing the spread of the virus.
“You must observe primary hygiene by washing your hands regularly, observe the social distancing, no meetings, no family visits, and no going to markets and other directives by the government”, he said.
He also commended the Chairman of the Omuma Local Government Council, Hon Christian Nwuiwu, and the representative of Omuma constituency in the Rivers State House of Assembly, Hon Emeka Nwogu, for working round the clock to ensure that the state government’s directives were obeyed.
Chief Ogbueri called on the people of the state to be patient and make necessary sacrifices, expressing hope that the difficult era of coronavirus would be over and people will return to their normal way of lives.

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Buhari Approves Withdrawal Of $150m To Support June FAAC Disbursement

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President Muhammadu Buhari has approved the withdrawal of 150 million dollars from the Nigeria Sovereign Investment Authority (NSIA) Stabilisation Fund to support the June 2020 FAAC disbursement.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, disclosed this during a news conference on the fiscal stimulus measures in response to the COVID-19 pandemic and oil prices fiscal shock in Abuja, yesterday.
Ahmed said that the fund was also to address these emerging fiscal risks that the pandemic had caused.
She noted that the Stabilisation Fund was created for such emergencies and was to be utilised for this purpose while the government was also exploring other options to augment FAAC disbursements over the course of the 2020 fiscal year.
She explained that based on the fiscal assumptions underpinning the 2020 Appropriation Act, monthly Federation Account Allocation Committee (FAAC) disbursements to the Federal and State Governments were projected at N888.5 billion.
She said, however, that due to the significant drop in international oil prices, FAAC monthly disbursements had declined in recent months to N716.3 billion in January and N647.4 billion in February 2020.
According to her, their experience shows that monthly average FAAC receipts must average at least N650 billion for the federal and state governments to meet their current obligations. Unfortunately, they project that monthly receipts may decline to below N400 billion, over the next three to six months.
“Mr President has also approved that the Federal Ministry of Finance, Budget and National Planning should engage with the CBN to agree on a Debt and Interest Moratorium for States on Federal Government and CBN-funded loans, in order to create fiscal space for the States, given the projected shortfalls in FAAC allocations,” he said.

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Nigeria To Source N2.67trn Additional Fund For COVID-19

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The Federal Government will be sourcing for over N2.67trillion to fully execute the COVID- 19 stimulus. This is aside the N500 billion already earmarked for the stimulus package.
Addressing journalists on the details of the COVID- 19 stimulus, yesterday, Minister of Finance, Zainab Ahmed, said Nigeria would draw down her facility with the International Monetary Fund (IMF) totalling $3.4 billion in addition to $2.5 from the World Bank, $1 billion from the African Development Bank and $150 million from the Stabilisation fund of the Nigeria Sovereign Investment Authority (NSIA).
The N2.67 trillion, she said, does not include what the government will access from the Islamic Development Bank (IDB) and dividends expected from Nigerian Liquified Natural Gas (NLNG).
According to Ahmed, Nigeria has a contribution of $3.4 billion with the IMF and we are entitled to draw up to the whole of that $3.4 billion no less. We have in the first instance applied for that maximum amount, then in the process when we negotiate we might get the maximum amount or less.
“That is the amount of our contribution with the IMF and this is the provision that IMF has made for every member country that you can apply for between 50 to 100 per cent of your contribution to the IMF.
This money from the IMF, she explained: “is a programme that has no conditions attached to IMF programmes and this is not an IMF programme. Up to date, we were told that up to about 80 countries have applied to draw from their contributions to the IMF.”
Other sources of fund the government hopes to draw from to meet the challenges of the coronavirus, the minister said, include a “request from the World Bank for $2.5 billion; from the African Development Bank (AfDB) $1billion.”
The request made to the IMF, World Bank, IDB, and the AfDB, she said, “are request for the nation both for the Federal Government as well as the state”.
In order to address the emerging fiscal risks, as a result of the drop in the international oil prices and global outbreak of coronavirus (COVID-19), President Muhammadu Buhari has given a number of approvals.

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