Nigerian Government to inject N350bn into economy – TV360Nigeria

muhammadu-buhari

The Nigerian Government has revealed plan to inject the sum of N350bn into the country’s economy as it seeks to move away from a recession.

The Minister of Finance, Kemi Adeosun told journalists in Abuja that the additional funding, is primarily for capital expenditure projects that would also involve support from local banks and transaction partners.

The government has also approved a three-year plan to borrow from abroad.

Adeosun noted that it would borrow a total of 1.8 trillion Naira at home and abroad.

The money will be used to fund an expected budget deficit of 2.2 trillion Naira.

The foreign loans would come from agencies such as the World Bank, African Development Bank, China Exim Bank, and other development agencies like the Japanese International Cooperation Agency (JICA).

It is expected that the loans will come with rates of 1.25 percent and a 20-year maturity.

Nigeria was Africa’s largest economy and its top oil producer, but its public finances have suffered as the price of crude oil dropped around the world.

Official Data from the country’s bureau of statistic showed that its gross domestic product (GDP) contracted by 2.06 percent in the second quarter, sending Africa’s biggest economy into a recession after a decline in the first quarter.

The economic crisis has also worsened due to attacks on the country’s pipelines by a militant group known as the Niger Delta Avengers.

The attack by militants had driven oil production to around 700,000 bpd, below its 2016 budget assumption of 2.2 million barrels per day.

Nigeria was last in a recession, for less than a year, in 1991, and experienced a prolonged one that started in 1982 and last until 1984.

The government has so far disbursed more than 400 billion Naira in capital expenditure this year, part of a record 6.06 trillion Naira ($30 billion) budget for 2016.