FG releases N700 billion for capital projects to tackle recession – Finance minister

The federal government on Friday said it has so far released and fully cash-backed about N420 billion in capital expenditure and investments in various projects. This is part of a plan to reflate and reposition the economy out of recession.

The Minister of Finance, Kemi Adeosun, said at a media briefing in Abuja, the monies were released since May when the 2016 fiscal appropriation was passed.
In addition, she said another N350 billion, to be released at the end of the cash planning meeting on Friday, would hit the various ministries, departments and agencies’ (MDAs) accounts next week.

Another N60 billion would be released for social intervention programmes, including school feeding programme and teachers’ assistants scheme designed to put money into the pockets of Nigerians.

Mrs. Adeosun said the releases were for capital projects in key sectors of the economy; namely power, works and housing, interior, transport, agriculture and defence.

“This will take our total capital spend to over N700 billion,” she said. “We are funding the rehabilitation of abandoned airport projects. Significant funding is going into agriculture, because of the time sensitivity of the sector.

“Government had to intervene to ensure food production was restored to bring down rising food prices. A lot has gone in for defence, because we needed to rebuild and retool the capabilities of our army, to continue with the efforts in the North East part of the country,” Mrs. Adeosun explained.

The minister said the focus of the social intervention programmes would enable government release monies for the N5,000 stipend to the most vulnerable people in the society. It will also enable government funding for the schools feeding programme, designed to increase economic activity in local governments.

Besides, the minister said, the release of the funds will enable thousands of graduates who have enlisted as primary school teaching assistants under the N-Power programme, to get their salaries or stipends at the end of the month.

In line with external borrowing plan approved two weeks ago, to enable government borrow cheapest monies available to fund key ongoing projects, the minister said government has concluded plans to raise additional $1 billion through Euro bond capital raise.

Apart from government being in the process of appointing transaction advisers for the bond raise, Mrs. Adeosun said the World Bank, African Development Bank (ADB), and other multilateral and international lending financial institutions, have already approved the lending plan.

Details of the loans, she said, include facility at interest rates of 1.5 per cent, with repayment tenors as long as 40 years, to help government intervene in some specific areas like agriculture, education, health, rebuilding of movable things, and railway projects considered key to government effort to revamp the economy.

Noting the challenge of time lag in fiscal activities, the minister said there was always a delay between money release and when the people begin to feel the effect of such intervention.
She assured that government was working with the relevant agencies, particularly those involved in the procurement processes, to see how to shorten the contract processes.

“We are working with the ministries to try to speed things up. We are working with the Bureau for Public Procurement (BPP) to see how to fast track the process of contracts so the delays could be removed, so that monies could trickle down into the pockets of Nigerians.

“We have strategic plans to take us out of recession. We want to ensure the recession is as short as possible. We don’t want to prolong the recession. We think some of the initiatives we are working on will begin to bear fruits. Already there are activities resuming on roads, power, health, solid minerals, water resources,” she said.