The federal government has said that the Nigerian economy is already on its way out of recession.
The government based it’s assertion on the 8-fold over subscription of its recent Eurobond (orders in excess of US$7.8 billion compared to a pre-issuance target of US$1bn), which the government posits has demonstrated strong market appetite for Nigeria, and showed confidence by the international investment community in Nigeria’s economic reform agenda.
This is in addition to the modest return of the non-oil economy to positive territory at 0.03 per cent in 2016 Q3 after two consecutive quarters of negative growth.
According to Issue 23 of the Aso Villa Newsletter called ‘Government at Work’, released by the Presidency yesterday, the government averred that the marginal growth is due to the continued good performance of the agriculture and the solid minerals sectors.
While agriculture grew by 4.54 per cent in the quarter under consideration of which growth in crop production at nearly 5 per cent was at its highest since the first quarter of 2014, growth in the solid minerals sector was said to have averaged about 7 per cent.
The federal government said that the Anchor Borrowers Programme (ABP) of the Central Bank of Nigeria (CBN) which substantially raised local rice production in 2016 (yields improved from 2 tonnes per hectare to as much as 7 tonnes per hectare, in some States) and produced a model agricultural collaboration between Lagos and Kebbi States is a pointer to a growing economy.
“The Fertilizer Intervention Project (which involves a partnership with the Government of Morocco, for the supply of phosphate) is on course to significantly raise local production, and bring the retail price of fertilizer down by about 30 per cent.
“The newly established Development Bank of Nigeria (DBN) is finally taking off, with initial funding of US$1.3bn (provided by the World Bank, German Development Bank, the African Development Bank and Agence Française de Development) to provide medium and long-term loans to MSMEs.
“A new Social Housing Programme is kicking off in 2017. The ‘Family Homes Fund’ will take off with a 100 billion naira provision in the 2017 Budget. (The rest of the funding will come from the private sector),” the federal government newsletter read.
The government further explained that more than N800 billion had been released for capital expenditure in the 2016 budget, since implementation started in June 2016, adding that this is the largest ever capital spending within a single budget year in the history of Nigeria.
It said these monies have enabled the resumption of work on several stalled projects – road, rail and power projects – across the country and implementation of the Social Investment and Empowerment Programme (SIP) as all the four components of the SIP have now taken off.
“The SIP is the largest and most ambitious social safety net programme in the history of Nigeria, with more than 1 million beneficiaries so far: – 200,000 N-Power beneficiaries, 23,400 Government Enterprise and Empowerment (GEEP) Scheme beneficiaries, 1,000,000 Homegrown School Feeding Programme (HGSFP) beneficiaries, as well as ongoing Conditional Cash Transfer (CCT) payments across nine pilot states.
“Strategic Engagements with OPEC and in the Niger Delta have played an important part in raising our expected oil revenues. Already, Nigeria’s External Reserves have grown by more than $4 billion in the last three months.
“Collaboration with China, proceeding from President Buhari’s April 2016 visit, has unlocked billions of dollars in infrastructure funding. Construction will begin on the first product of that collaboration, a 150km/hour rail line between Lagos and Ibadan, in Q1 2017.
“The National Economic Recovery and Growth Plan (NERGP), the Federal Government’s medium-term Economic Plan, is due for launch in February 2017, and will chart a course for the Nigerian economy”.