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COVID 19: How Buhari hopes to stimulate economy

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As countries across the world marshal out plans for a post COVID 19 world, Nigeria’s President Muhammadu Buhari has announced its post-COVID-19 plans for Nigeria’s economy.

While stating the Buhari’s administration’s plan during his participation as a guest panelist in the Emmanuel Chapel’s “Economic Sustainability Beyond COVID-19” webinar, Vice President Professor Yemi Osinbajo said the Federal Government plans to  improve the healthcare infrastructure and economy, while creating more jobs for millions of Nigerians in different sectors, supporting small businesses, local production and manufacturing, as well as extending the social safety net for the most vulnerable in society.

On the Buhari administration’s efforts to cushion the effects of the pandemic on Nigerians, the Vice President stated that improving healthcare infrastructure remains a major objective of the administration.

He said, “Out of the N500bn initial stimulus fund that is factored into the current budget, N126bn of it is going into healthcare.

A major revenue source of the Federal Government –Company Income Tax according to the plan will also be reviewed downward.

“In our case, our Tax-to-GDP has been extremely low, VAT in particular. Nigeria’s 7.5% VAT rate is probably the lowest when compared with some other African countries. For example, Kenya has about 16%, South Africa is about 15%, Algeria has 19%. Besides, at the moment, domestic revenue mobilization is an issue.

“A major source of revenue for government is tax. But you must also take account of the fact that we’ve also reduced Company Income Taxes generally, especially for small businesses, which are the engines of growth for the country. So, there is a conscious effort to ensure that we don’t tax businesses out of business.”

On the epileptic power supply which has crippled and outrightly prevented many small scale businesses to thrive, the VP stated that one of the proposals of the Economic Sustainability Plan was the adoption of renewable energy, especially solar, and working with the private sector to install mini-grids and solar home systems across the country.

He said, “We’ve done quite a bit of that already. We have in places like Sabon Gari, Ariaria markets: a private sector deployed solar systems that are paid for by stall owners in those markets. We’ve done micro grid in Sokoto state. Interestingly, this is entirely private sector driven and the consumers are prepared to pay for service. You find that they pay even higher than the tariffs people pay for grid power.

“A private sector-driven solar power system, such as the one we are planning as part of the Economic Sustainability plan, is one that we think would work and stands a good chance of providing power to about 25 million (individual) Nigerian homes, places and homes where there has been no power previously.”

To further tackle the issue of unemployment among young Nigerians, the VP stated that the administration intends to increase the number of those that are being directly engaged through the N-Power scheme, which has so far engaged over 500,000 young Nigerians.

The noted that the “President recently asked that another million households of the extremely poor should benefit from the SIPs Conditional Cash Transfer, of which we are already doing about a million beneficiaries, which means they would get about N5,000 every month, which we are doing at the moment

We’ve done several microcredit loans through the Tradermoni, Farmermoni and Marketmoni schemes. And we are thinking of increasing microcredits to petty traders, artisans, farmers etc.; we are looking at doing almost four million new microcredit loans.

“While we are waiting for all the initiatives around industries, creation of jobs to catch up, there is a need for us to answer the questions around, “how do poor people survive,’ while we are waiting for the trickle down of industries, and all of that. That’s why expanding the Social Investment Programmes the way we are doing is important for us,” he said.

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