BEVERLY HILLS, August 31, (THEWILL) – The Minister of Finance, Kemi Adeosun, has declared that the Nigerian economy is not in confusion insisting that the economy had been heading to recession in the past six years but is presently in the right hands.
She spoke with State House correspondents at the end of the Federal Executive Council (FEC) meeting presided by President Muhammadu Buhari.
“It’s the worst possible time for us. Are we confused? Absolutely not. How are we going to get ourselves out of this recession? One, we must make sure that we diversify our economy. There are too many of us to keep on relying on oil,” she said.
“We can see what happened at the output data of the oil and gas sector. What’s happening in the Niger delta has dragged down the GDP of the entire economy. We’re too dependent on oil whereas 87 percent of our GDP is oil. So let us drive those other areas
“We have to invest in capital projects. No, we are not confused, the time is confusing but we are not confused. We are extremely focused. We know that if we can just bare and get through this difficult period, Nigeria is going to be better for it.
“If we rely on oil and the price of oil remains low and the quantity of oil remains low, we can’t grow. We have to grow our non-oil economy. I think we that we have a long way to go.
“We’re not confused and we’re not deceiving ourselves that everything is rosy. It’s not. It’s a difficult time for Nigeria but I think Nigeria is in the right hands and if we can stick with our strategy. We still have some adjustments to make.
“I think we need to make some adjustments in monetary policy. It’s quite clear we do and we will do that. We’re working on that. We need to try and find a way to support the manufacturing sector better and we will do that.
“And when you have cost-push inflation, it is structural inflation. It is not going to respond to monetary policy tools such as increasing the rate of interest. We have to address the structural causes of the inflation.
“Recall when we came in we said our external borrowings strategy will be focused on confessional debts, low cost loans particularly from the multi-lateral agencies. The conditions of the borrowing includes concessional loans average interest rates 1.25 per cent, four to seven year moratorium, and 20 years to pay.
“The loans will come from agencies like the World Bank, African Development Bank, China Exim Bank, and other development agencies like Japanese International Cooperation Agency (JICA)
“The sectors in particular that these concessional loans will go to are the strategic sectors of the economy that will help to revive the economy. There is Power. Significant amount of money are located to power projects particularly transmission. This is long term money that will enable us solve some of the problems in that sector.
“There are projects around polio. There are some money that have been allocated to us to help us do some massive immunization, in order to control this recent outbreak. This is being provided by the World Bank.
“There is provision for solid minerals and of course I’m very excited about the discovery of nickel. World Bank is supporting the project by the Ministry of Mines and Steel with $150 million to enable them strengthen their capacity in that area.
“The largest beneficiary of our borrowing is agriculture because its equally strategic and we have programmes by the minister some of which he inherited and is going to restructure and reform and some are new to the ministry.
“The balance will come from the Eurobond we had indicated. Because a lot of this money is for developmental projects. We need this money to be made available for us. Remember these are foreign exchange coming to our country that will help our economy.”
Story by David Oputah
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