African Development Bank approves $288.5 millions for Nigeria COVID-19 Response Support Program
The Board
of Directors of the African Development Bank on Friday approved a $288.5 millions
loan to help Nigeria tackle the COVID-19 pandemic and mitigate its impact on
people and businesses.
The loan
will bolster the government’s plans to improve surveillance and response to
COVID-19 emergencies, ease the impact on workers and businesses and strengthen
the social protection system.
Nigeria,
Africa’s most populous nation and the continent’s largest oil producer, is facing
twin crises – a health epidemic caused by COVID-19, and an economic crunch
largely occasioned by a global oil price plunge. As of June 5, the country
reported 11,516 coronavirus cases, 3,535 recoveries and 323 deaths.
The loan
is the Bank’s initial response to help mitigate the slump in oil prices and its
impact on the national economy.
About
40.1% of Nigerians live below the poverty line of $1.90 per day and it is
feared that the fall in household income during the pandemic will result in
wealth deterioration for both the formal and informal sector workers.
“The
proposed program will ensure that the fiscal position and the economy are
sufficiently supported to weather the COVID-19 shocks, thereby limiting its
potential adverse impact on livelihoods and the economy more generally,” Ebrima
Faal, Senior Director of the African Development Bank for Nigeria said.
Prior to
the COVID-19 outbreak, Nigeria’s economy was projected to grow by 2.9% of GDP
in 2020 and further expand by 3.3% in 2021. But with the advent of the pandemic
and the slump in crude prices, the economy is expected to shrink by between
4.4% under a conservative baseline scenario, and 7.2% should the pandemic
persist to end-2020.
Faal said
beyond the country’s immediate economic recovery needs, the Bank and other
development partners, will dialogue with the government on proposals for
medium-term structural reforms to diversify and boost domestic revenues away
from the oil sector.
The Bank
has instituted strong fiduciary measures to monitor the use of COVID-19 funds,
and will maintain dialogue, particularly with the Office of the Auditor General
in Nigeria, to ensure adherence to the transparency and accountability of the
funds, Faal said.
The
Bank’s intervention aligns with its COVID-19 Response Facility (CRF); Ten-Year
Strategy (2013-2022); and High 5 priorities, especially “Improve the quality of
life for the people of Africa”. It is also consistent with the second strategic
pillar of the recently approved Bank’s Country Strategy Paper 2020-2024 for
Nigeria.
AGM
Source
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