The Minister of Finance, Mrs. Kemi Adeosun has disclosed that the Federal Government plans to inject N350 billion into the economy on quarterly basis so as to stimulate economic growth and development.
Speaking on Thursday in a television magazine programme, she said the fund will be released as soon as the budget is signed.
“As soon as the budget is signed, we are going to pump N350 billion into the economy in this quarter and we are going to do so every quarter until we stimulate growth. And we would see growth if we spend money on those things that would create jobs,” she said.
Adeosun said there are no quick solutions to fixing the economy. “What I will tell you is that there are no quick solutions to fixing the economy. If you have cancer, you cannot take panadol, you have to take proper medication. I don’t want to come here and give people false hope. I don’t want to use the word magic because ministers get into trouble when they use the word magic. It has to be done painstakingly,” she said.
The minister said the drop in crude oil prices presented a good opportunity to reposition the economy, saying that the opportunity for diversification of the economy created by the crisis should not be wasted.
“Everybody is now extremely sober. Every Nigerian is sober. All the governors have realised that oil price can plummet from $110 per barrel to $28 per barrel over such a short period of time and we could be so exposed that we cannot even pay salaries. “
On the sovereign wealth fund (SWF), the minister said what the federal government wants to do is “reposition it and have it focused in line with government’s objectives which is investments in infrastructure,” saying that the government realised that even with 30 per cent of the budget, the country’s infrastructure gap is so wide that government alone cannot bridge it.
“So, what we are hoping is that the sovereign wealth fund now becomes a channel to attract further private money particularly from investment funds from abroad. So, we really want to focus on infrastructure – toll roads, bridges, power plants, things that would help the economy grow.”
She added: “Let me explain the structure of states and federal government. Fifty-two per cent of the money actually comes to the federal government. So, even if the federal government say they want to spend theirs, the federal government too didn’t save its portion. Federal government was not saving. In fact, federal government was borrowing even to pay salaries. And that is where the disconnect comes in.
“So, I think it is largely unfair for the federal government to say states were the ones that made me to spend. I can spend mine, but I can’t force you to spend yours. The Federal government didn’t save its share. So, collectively, I don’t think we should be trending blames. I think what we should be doing now is to look at the lessons we have learnt. The federal, states and local governments must have savings. Even if we don’t have savings, we can have investments. Look at Saudi Arabia, it has about $700 billion of reserves unspent, and we have about $28 billion. Oil goes, oil comes but they still have something to show for it.”
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