- To raise $1bn Eurobond for infrastructure before year-end
The federal government disclosed on Friday that it is on the verge of releasing another tranche of N350 billion as part of the 2016 Budget capital vote, even as a total of N150 billion has been extended to some states under the Budget Support Fund, in the past three months.
The disclosures came as the government rehashed a cocktail of measures being put in place to reflate and pull the economy out of recession.
Addressing journalists in Abuja alongside key heads of parastatals under her ministry, the Minister of Finance, Mrs. Kemi Adeosun, stated that so far, a total of N420 billion has been released and cash-backed as capital vote since the budget was signed into law in May, adding that another N350 billion was on the verge of being released to bring the total releases to about N770 billion.
“We have a plan to reflate the Nigerian economy, to reposition it … When an economy is in recession, demand goes down because confidence goes down, people don’t have enough money to spend and there’s not enough money circulating in the system. … What the government wants to do is to step in and begin to spend and pushing more money into the economy and then get things moving again.
“When we started about a year ago, we had said this economy needed to be reflated. Growth was slowing consecutively for a number of quarters and there was always the remote risk of recession. We planned for that scenario that if that happens this is what we need to do.
Now, the general thrust has not changed. We need to reflate the economy, we need to switch the economy from a consumption-driven economy to an investment-driven economy.
“Since the budget was passed in May, we have released and cash-backed fully, N420 billion capital releases. As we speak now, we are about releasing another N350 billion. That’s between May and now,” she said.
According to her, one of the sectors that received the largest chunk is Power, Works and Housing, adding that quite a lot had also gone into defence because of the necessity “to rebuild the credibility of the army to continue in their efforts in the new phase.”
Adeosun listed other sectors that have been major beneficiaries of the capital releases as Interior and Transportation.