The Federal Government, through the Central Bank of Nigeria, is set to commence the disbursement of N150 billion in loans to micro, small, and medium enterprises (MSMEs) and manufacturers by the end of July.

This initiative aims to bolster the nation’s economy amidst ongoing economic challenges.

Doris Uzoka-Anite, the Minister of Industry, Trade, and Investment, revealed this significant development on Thursday through her official X handle.

She stated that the government has dedicated N75 billion to support MSMEs and another N75 billion to the manufacturing sector.

The disbursement process is in its final stages, with applications still open for interested businesses.

The Presidential Conditional Grant Scheme, part of the broader Presidential Palliatives Programme, was unveiled in December 2023.

This scheme is designed to help businesses navigate the economic pressures resulting from recent government policies, such as foreign exchange market harmonisation and fuel subsidy removal.

“To all applicants of the Presidential Conditional Grant Scheme who are yet to be paid, thank you for your continued patience. The disbursement process is still ongoing, and we have allocated about 60 percent of the 1 million grants,” Uzoka-Anite noted.

The scheme has already provided financial grants of N50,000 each to 60 percent of the proposed one million beneficiaries across Nigeria’s 774 local government areas.

In response to complaints from applicants who have not yet received their grants, the minister clarified that the selection process was not based on who applied first but rather on a random computer-generated selection.

She acknowledged the delays in the disbursement process, attributing them to issues such as incorrect or missing data, duplicate applications, and spurious entries.

“Almost 4 million Nigerians applied for the Palliative grant of 50k, but only 1 million beneficiaries can be accommodated. This means not all applicants will receive the grant,” she explained.

Uzoka-Anite emphasized that the government is committed to ensuring fairness and accuracy in the disbursement process.

Last month, the government disbursed a total sum of N20.11 billion to 402,283 beneficiaries through their bank accounts, verified by their Bank Verification Numbers (BVNs).

The minister expressed her gratitude to the applicants for their patience and urged them to provide constructive feedback without resorting to abuse or bigotry.

“Personal insults and hate speech are not likely to aid your applications and will not be tolerated. Together, we can build a more prosperous Nigeria,” she added.

Nigeria’s fiscal landscape is facing unprecedented challenges as debt repayments now exceed both recurrent and capital expenditures.

Tilewa Adebajo, CEO of The CFG Advisory, stated these pressing issues during his presentation on “Nigeria’s Fiscal Environment in an Era of Monetary Policy Tightening” at the Finance Correspondents Association of Nigeria (FICAN) bi-monthly forum in Lagos.

According to Adebajo, Nigeria’s debt burden has surged to $130 billion, with 95% of the country’s revenue now allocated to debt servicing.

This development raises concerns about the sustainability of the nation’s fiscal policies and the potential for a debt default akin to those seen in Ghana, Zambia, and Ethiopia.

The National Bureau of Statistics (NBS) reported that Nigeria’s public debt stock soared from N97.34 trillion in December 2023 to N121.67 trillion in March 2024.

Despite allocating N8.7 trillion for capital expenditure in the 2024 budget, only N1.32 trillion is directed towards infrastructure development, highlighting the severe underfunding of critical sectors.

“The current debt levels are unsustainable,” Adebajo warned. “With an additional $10 billion from the 2024 budget deficit, we must commence discussions on restructuring both domestic and external debt to avoid severe economic repercussions.”

Nigeria’s economic indicators paint a grim picture. The country remains in stagflation, grappling with high inflation and stagnant growth.

The introduction of the Nigerian Autonomous Foreign Exchange Market (NAFEM) and the removal of fuel subsidies have boosted the Federation Account Allocation Committee (FAAC) revenues by 130% from May to November 2023, yet these measures have not sufficed to stabilize the economy.

Foreign Direct Investment has plummeted to under $1 billion, the lowest in history. Power transmission and distribution infrastructure remains poor, stifling industrial growth and economic productivity.

The macroeconomic situation has deteriorated over the last seven years, with GDP shrinking by an estimated $180-200 billion, now standing at $390 billion.

Adebajo emphasized the dire need for structural reforms. “Nigeria requires a GDP growth rate of 8-10% to sustain its population of 200 million. Current growth at 3% is insufficient, with 135 million Nigerians trapped in poverty and 40% unemployment,” he noted.

“Dwindling reserves and increasing credit default swap premiums have led to a Caa1 junk bond rating status.”

Despite these challenges, Adebajo expressed cautious optimism. “The fundamentals of the Nigerian economy remain sound. However, poor economic leadership has stifled growth. With a new, highly rated economic management team in place, there is hope for significant improvement if reform policies are implemented sincerely and effectively.”

Adebajo proposed several solutions to address the economic crisis:

1. Debt Restructuring: Engage creditors to restructure and extend debt maturities, allowing for manageable repayments and reduced interest rates.
2. Fiscal Discipline: Reduce non-essential government spending, eliminate wasteful subsidies, and enhance public service efficiency.
3. Revenue Expansion: Broaden the tax base, improve collection, and introduce new revenue streams such as value-added tax (VAT) and property taxes.
4. Transparency: Increase transparency and accountability in government spending to build public trust and attract foreign investment.
5. Monetary Policy: Maintain tight monetary policies to combat inflation and attract foreign investment.
6. Competitive Exchange Rate: Stimulate exports and reduce import reliance by maintaining a competitive exchange rate.
7. International Collaboration: Leverage regional and international partnerships for financial assistance, expertise, and market opportunities.
8. Public Engagement: Engage with the public, businesses, and civil society to garner support for economic reforms.

Adebajo concluded with a call for action, stressing the importance of commitment from the new economic management team to drive the necessary reforms and steer Nigeria out of its current economic quagmire.

“The success or failure of our economy hinges on their ability to deliver on reform policies and achieve sustainable GDP growth targets,” he asserted.

The International Monetary Fund (IMF) has acknowledged the significant role played by Zimbabwe’s newly introduced gold-backed currency, the ZiG, in stabilizing the nation’s economy.

The IMF’s assessment follows its recent Article IV Mission to the country, which concluded that the ZiG has effectively ended the economic volatility that marked the first quarter of the year.

In a statement released late Wednesday, the IMF said, “The ZiG official exchange rate has so far remained stable, ending a bout of macroeconomic instability in the first three months of the year. Assuming that macro-stabilization is sustained, cumulative inflation in the remainder of the year is projected at about 7 percent.”

The ZiG currency, introduced in the second quarter of this year, is backed by 2.5 tons of gold and $100 million in foreign currency reserves held at the central bank.

This measure is Zimbabwe’s sixth attempt in 15 years to establish a stable local currency.

Unlike its predecessors, the ZiG is strictly regulated to prevent overprinting, a practice blamed for the downfall of previous currencies.

The rapid decline of the Zimbabwe dollar had severely affected the economy, with inflation soaring and the local currency losing value daily on both official and parallel markets.

The instability made everyday transactions cumbersome, as prices needed constant adjustment to account for the currency’s depreciation.

IMF officials praised the Zimbabwean authorities for their improved monetary policy discipline, a crucial factor in achieving the current economic stability.

“The improvement in monetary policy discipline is commendable. Further refinements to the policy framework are encouraged to maintain this positive trajectory,” the IMF stated.

In a related move, Zimbabwe’s central bank’s monetary policy committee opted to keep interest rates unchanged at 20%, a decision aimed at sustaining the newfound stability.

Governor John Mushayavanhu emphasized the committee’s commitment to a tight monetary policy stance, saying, “The MPC has resolved to maintain the current tight monetary policy stance to ensure the sustenance of the current stability.”

Despite these positive developments, the IMF projects that Zimbabwe’s economic growth will slow to 2% this year from 5.3% last year, attributing the decline to an El Niño-induced drought.

However, growth is expected to rebound to 6% next year, supported by a recovery in agriculture and new projects in the manufacturing sector.

In a bid to further stabilize the economy, the Zimbabwean Treasury has been given oversight of the Sovereign Wealth Fund, also known as the Mutapa Investment Fund.

This move is intended to ensure that stabilization efforts are effectively managed and that the economy remains on a stable footing.