President Muhammadu Buhari has said that the Economic Sustainability Plan (ESP) of the federal government is intended to mitigate such impact as the novel coronavirus on the economy> the pandemic has plunged the country into a recession, as recently announced by the National bureau of Statistics (NBS).
The president added that the speedy pathway out of the current recession was to quicken the implementation of the ESP.
President Muhammadu Buhari made the remark in a speech delivered virtually by vice President Yemi Osinbajo, on Monday at the opening session of the 26th Nigerian Economic Summit Group Conference themed: “Building Partnerships for Resilience.”
The development comes as economic analysts interviewed by this medium have expressed confidence that the country is likely to exit the current recession some time in 2021 as several companies, including AstraZeneca, Pfizer and Moderna have churned out vaccines that are at the stage of approval for mass administration.
Economists project that with the soon availability and administration of vaccines on a global scale, economies are likely to be opened up, production of goods and services increased, economic activities increased, and by extension, the demand for oil, which will increase the price of oil on the international market and earn Nigeria more revenues, thus hastening an exit from recession.
Also, the minister of finance, Mrs. Zainab Ahmed said that the current recession would be a short one, as government and key stakeholders were proactively working together to put in place sustainable measures to curtail and improve the situation.
She added that in spite of the recession, Nigeria had out-performed many economies in terms of economic growth.
Ahmed said that the Federal Government, in partnership with the NESG had been working together on the national implementation plans as well as the regional and local development plans.
According to President Buhari, all the programmes in the ESP are reliant on the private sector playing a key role in creating and conserving jobs and the production and delivery of services in agriculture, housing, solar power and digital technologies.
“Of course, an improvement in global economic conditions, including the restoration of global supply chains and resumption of exports and remittances, should enable a V-shaped recovery.
“We expect, in the same spirit of partnership, that the private sector will complement these efforts by making maximum use of the provisions of the ESP and the Finance Bill when it is passed by the National Assembly and also by retaining and creating jobs so as to keep people at work.
“In a similar spirit of partnership, private sector enterprises should also pay their due taxes,’’ he added.
Speaking on the theme of the summit, he said that partnerships remained essential to attract the resources for building a solid national infrastructural base.
Buhari said that as was evident when the nation was combatting COVID-19, partnerships were essential and also necessary for framing medium and long-term development plans.
He added that the government had always emphasised that the private sector had a key role to play in the efforts to build a more resilient and competitive economy as expressed in the Economic Recovery and Growth Plan.
Buhari said that private companies in design, construction, logistics and finance were very much engaged in the nation’s infrastructural projects in power and rail as well as road and bridges.
Meanwhile, the federal government has disclosed that it is working with the Central Bank of Nigeria (CBN) and the Nigeria Sovereign Investment Authority (NSIA) and other stakeholders in the creation of a N15 trillion Infrastructure Company (Infraco) fund to address some of the nation’s critical infrastructure needs.
“It goes without saying that partnerships remain essential to attract the resources for building a solid national infrastructural base. I am pleased to inform you in this regard that we are working actively with the Central Bank, Nigerian Sovereign Investment Authority and State Governments under the auspices of the National Economic Council to design and put in place a N15 trillion Infraco Fund which will be independently managed.
“With subsidy removal and the increase in fuel price and the pass through to food prices, transportation cost, of course has to be reduced. Now, the automotive policy is directed at localizing production of vehicles. So the logic has always been and remains that if we increase the duties and levies on imported cars and vehicles, local production becomes competitive,” the vice President stated.
The President insisted that the decision was part of economic measures targeted at revamping the economy and put it on growth trajectory.
Commenting on measures to assuage the pains if the masses, He explained further that government will also energize other sectors of the economy that were depressed on account of high transportation cost, adding that government is not giving up on the auto industry or the auto industry policy.
Osinbajo said the central government is also promoting a policy that government must buy only locally manufactured cars. According to him, the federal government is committed to buying only locally assembled cars, while relying on sub-national governments to commit to buying newly locally produced vehicles.
“We believe that if governments (themselves) commit to buying only locally assembled vehicles, we will be able to take up most of what is being produced locally; and of course, begin a partway to having our auto industry as time goes on,” he added.
Osinbajo said annual demand for vehicles in the country stands at about 720,000 vehicles per year, while actual local production of vehicles today by the assembly plants is in the order of 14,000 vehicles a year. What that means is that 720,000 is a demand, 14,000 vehicles a year, is the supply.
The vice President was reacting to the concern earlier raised by Mr. Chidi Ajaere of the God Is Good group who said the planned reduction of the levies on vehicles and cars is antithetical to local manufacturing and assembling of vehicles in Nigeria. He decried the move, saying it will grossly affect local manufacturing of Nigeria-made vehicles. “A business can be as great as the government allows it to be.”
Prof. Osinbajo said at the current rate of production, “we will not meet serious national needs and this will mean higher prices of vehicles… and other sectors of the economy that depend on transportation at a time of a national economic emergency, especially with rising food prices, rising transportation prices.