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22 May 2020

COVID-19: Economy’ll go into recession — FG

THE Federal Government yesterday painted a gloomy picture for the country, saying the country’s economy would go into recession as a result of the dreaded coronavirus pandemic.

It said that the looming economic crisis would inflict more misery on the country through increase in the poverty rate. This came as the National Economic Council, NEC, yesterday constituted an ad-hoc committee to liaise with the Presidential Task Force on COVID-19 to work out modalities for the reopening of the national economy.

Briefing State House correspondents after the first virtual NEC meeting presided over by Vice President Yemi Osinbajo, coordinated at the Vice President office, Presidential Villa, Abuja, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said the fall in crude oil price in the international market has worsened the economic situation of the country. “ The World Bank maintains that the impact of the COVID-19 on Nigeria will lead to severe amplified human and economic cost, which will move the country into a recession. “ The World Bank planned a proposed package for immediate fiscal relief for the Federal Government. This will also involve policy-based policy budget support for the Federal Government, focusing on measures to maintain macro financial stability and create fiscal space for proposed stimulus. “The World Bank package has also got a proposal of $1.5 billion for the states and this package will be dedicated to the states. And it will be a programme for results which the states are already used to implementing. “So, the immediate fiscal relief for the states, as stated in the presentation, will include the acceleration of an existing programme to enable disbursement by end of September.

“So, the proposed $1.5 billion plan will by end of September it would have been disbursed to the states. We are looking at an average of between N150billion to N200billion based on the plan to the 36 states. These are states that have already made some particular commitments and achievements so that they will be able to get immediate disbursements of parts of these funds.” The minister, who noted that her ministry reported to Council the funds in three special accounts, said: “So, in the Excess Crude Account, we reported the balance as of May 21, 2020, the balance of US$72.04 million. We also reported to Council that in the Stabilization Account, we have as at today a balance of N39.337 billion.

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