Connect with us

Economy

COVID-19 Gulps $8 trillion Globally in Response Packages – IMF

Published

on

International Monetary Fund, IMF
Share

 

By Mathew Dadiya, Abuja

The International Monetary Fund, Wednesday, said so far, countries around the globe have taken fiscal actions amounting to about $8 trillion to contain the pandemic and its damage to the economy.

The IMF, which disclosed this during a briefing at the ongoing Spring Meetings in Washington DC, United States, said that in times of pandemic, fiscal policy is key to save lives and protect people.

It advised that governments have to do whatever it takes, stressing, ”but they must make sure to keep the receipts.

According to the Fund, the Fiscal Monitor shows how policymakers can offer emergency lifelines to: save lives; protect people from losing jobs and incomes, and companies from bankruptcies; and enable a recovery.

Given the break down it said, emergency lifelines provided globally include higher spending and foregone revenues ($3.3 trillion), public sector loans and equity injections ($1.8 trillion), and guarantees ($2.7 trillion). 

The Group of Twenty advanced and emerging economies are at the forefront with actions totaling $7 trillion, the Fund noted. 

”Fiscal support is also provided by automatic stabilizers— features of the tax and benefit system that stabilize incomes and consumption, such as progressive taxation and unemployment benefits, ” the IMF stated.

On when the world is likely to recover from this shock, the IMF said, ”We do not know enough to foresee the timing and circumstances of the eventual recovery. But in times of emergency, the implication for policymakers is do whatever it takes but make sure to keep the receipts.”

It therefore, laid three guiding principles for countries to follow:

• “Target support to households to ensure access to basic goods and services and to a decent standard of living. To avoid permanent scarring, target support to viable businesses to limit layoffs and bankruptcies.

•” Deploy resources in a temporary and efficient way and reflect the costs in multi-year fiscal reports. Governments should reinforce principles of good governance commensurate with the scale of intervention. That should include, for example, accurate accounting; frequent, timely and complete disclosure of information; and the adoption of procedures to allow for ex-post evaluation and accountability. In a nutshell, policymakers should do whatever it takes but make sure to keep the receipts.

• “Assess, monitor, and disclose the fiscal risks because not all measures will have an immediate effect on deficits and debts. For example, government guarantees extended on business loans may have no upfront costs but will fall on the government accounts if businesses fail to honor their obligations in the future.

Actions to save lives globally

In order to save lives, the global fund advised that governments should finance additional health and emergency services as much as needed. 

“But this is challenging, ” the IMF acknowledged. 

It said, first, countries with limited health care capacity cannot adequately scale up resources. and secondly, borrowing constraints in many emerging market and developing economies requires shifting expenditure toward the health sector while safeguarding social protection spending and vital public services (transport, energy, communications).

It also noted that global coordination would help achieve a universally low-cost vaccine and medicine, and support countries with limited health capacity, including through aid, medical resources, and concessional emergency financing. ”As our Managing Director said in her recent speech, the IMF stands ready to deploy $1trillion lending capacity to assist member countries, with a focus on low-income developing countries, ” it assured.

Protect livelihoods with targeted fiscal measures

The IMF advised that social distancing necessary to slow the virus’ spread- with closed schools, restaurants, shopping centers, offices, and factories- inevitably carries economic costs. 

It added that people and businesses need large, timely, temporary, and targeted fiscal support to remain afloat.

The international Fund stated: ”Countries’ institutional and financial capacity will influence the size of the lifelines they can offer along with the design and type of measures:

• Advanced economies can rely on a wide range of instruments on the spending, tax, and liquidity front to support people and firms given their strong tax-benefit systems. 

”In the United States and Germany, for example, measures include extended unemployment benefits, including for the self-employed; payroll tax deferral; and wage subsidies to small and medium enterprises.

”Many workers, small enterprises, and self-employed entrepreneurs struggle to pay bills, make debt payments, and keep people on the payroll. To help them, several European countries have rolled out liquidity lifelines such as affordable loans or guarantees. France and Japan are providing government-funded paid sick and family leave to those who are unwell, self-isolate, or have to stay home and look after children during school closings.

• Emerging market and developing economies typically have less room in the budget to respond. They face several shocks: the pandemic, a steep drop in demand from abroad for their goods and services, plunging commodity prices, capital flight, and higher borrowing costs in financial markets. Also, they have relatively less developed tax-benefit systems.

”In those cases, in countries like India and Kenya, cash transfers made with the help of unique identification systems and digital technologies, or in-kind provision of food and medicine are possible options, such as in Bangladesh. China offers temporary tax relief for the most-affected people and firms, including in transportation, tourism, and hospitality services. Full and timely value-added tax refunds can grant businesses access to much needed cash.

Facilitate the recovery with broad-based fiscal stimulus

”As the pandemic abates and the Great Lockdown ends, a globally coordinated, broad-based fiscal stimulus may become an effective tool to foster the recovery. Coordination enhances the effectiveness of policy actions. But, at the same time, it has to respect relevant differences across countries, mainly in their financing capacity.

”The pandemic and the associated Great Lockdown led to increases in debt and deficits beyond those recorded in the global financial crisis. As the pandemic abates and the economy recovers in 2021, public debt ratios are expected to stabilize at new—higher—levels. If the adverse scenario in the World Economic Outlook were to materialize, debt levels would be even higher and debt dynamics more unfavorable.”

Economy

Value Addition is new Standard in Mining Operations – Alake

Published

on

Share

The Minister of Solid Minerals Development, Dr Dele Alake has declared value addition as the new indispensable standard for mining operations in the country.

Alake made the declaration in a statement issued by his Special Assistant on Media, Mr Segun Tomori, on Tuesday in Abuja.

The minister had earlier said that the federal government had resolved to ensure compliance to value addition before permitting investors to operate.

He said that his seven-point agenda for the ministry had placed the mining sector on the global front burner since assuming office, which had generated renewed interest from the international community in Nigeria`s mineral resources.

According to the statement, the minister lauded a mining company, African Natural Resources and Mines Ltd.

(ANRML), during an inspection tour in Kaduna State, for its 600 million dollar facility dedicated to the mining and processing of magnetite iron-ore.

He described the move as in line with the government`s resolve for value addition, which is especially apt given President Bola Tinubu`s quest to develop the solid minerals, to boost Nigeria`s economic profile and to meet the global upsurge in energy transition.

“The company aligns with our vision of value addition and beneficiation through its processing of iron-ore, and I urge other mining companies to take a cue from them, “ he said.

He reiterated the government`s commitment to abstain from granting mining licenses to companies that lack the necessary plans for value addition.

The minister acknowledged that resilience, courage and laying a solid foundation were critical in contributing to the company success.

He added that such factors also serve as guidelines for President Tinubu`s administration in its efforts for economic transformation.

“ We have set our minds in this administration and invariably in Nigeria to achieve success, that is why Mr President is restructuring the economy.

“When this company (ANRML) started seven years ago, we saw one of the foundations through the video documentary, the amount of concrete that went in to erect a foundation, just to carry a giant edifice.

“That is what we are going through. When we get through the gestation period, the results will manifest, and it will herald prosperity, “he said.

The minister had stated that no license would be granted to companies wishing to enter the mineral sector without presenting a plan for value addition, such as processing and refining which has multiplier effect on the economy. (NAN)

Continue Reading

Economy

Life Insurance Records 95% Net Claims in Q4 2023-NAICOM

Published

on

Share

The National Insurance Commission (NAICOM) says Life insurance business recorded about 95 per cent net claims of the total claims in the fourth quarter of 2023.

A report by NAICOM in Abuja on Tuesday hinted that the record was due to the direct reflection of the ongoing regulatory measures by the Commission regarding claims settlements.

NAICOM said the insurance market average stood at about 71.

4 per cent of the N536.
5 billion gross claims reported at the close of the fourth quarter.

The Commission said the market also recorded retention of about 87.7 per cent for the life business, 54 per cent for non-life while the aggregate market average retention stood at 66.

7 per cent for the period.

It showed that the insurance industry sustained its progressive trend of positive market performance at the close of 2023 fourth quarter.

According to NAICOM, the insurance market recorded a milestone growth to close at N1.003 trillion, representing about 27 per cent growth compared to the N790 billion recorded in 2022.

”Major growth drivers in the non-life segment of the market were oil and gas and fire Insurances contributing 27.3 per cent and 24.1 per cent respectively.

”In a direct reflection to the “no-premium no-cover” policy of the Commission, the outstanding premium continues to decline.

”The premium posted 1.6 per cent as outstanding of all the premiums generated in the market during the period.

”Statistics also shows that the market recorded total assets of about N2.67trillion and capitalisation of N851billion in 2023,” NAICOM said. (NAN)

Continue Reading

Economy

No Mining License without Mineral Value Addition Plans-Alake Warns

Published

on

Share

The Minister of Solid Minerals Development, Dr Dele Alake has warned that no mining license would be issued to prospective investors without requisite plans for value addition on minerals.

Alake gave the warning in a statement  by his Special Assistant on Media, Segun Tomori on Tuesday.

He said the Federal Government had resolved to ensure compliance before permitting investors to operate.

He said that his Seven -Point Agenda for the ministry had placed the mining sector on global front burner since assuming office, which had generated renewed interest from the international community in Nigeria’s mineral resources.

He said the support of the executive and the legislature had enabled the ministry to showcase the solid minerals sector globally, resulting in his election as the Chairman of the Africa Minerals Strategy Group (AMSG) at the Future Minerals Forum in Riyadh, Saudi Arabia.

According to him, with the pact that led to the formation of the AMSG, there is now unity of purpose on the African continent regarding the issue of local value addition.

“We are no longer going to allow anybody or license any company that wants to go into the mineral sector without giving us a plan for local value addition,  like processing, refining and this has a multiplier effect on the economy.

“It instantly generates employment rather than a few people carting away lithium, gold, and the likes to other countries to sell.

“These minerals must now be processed in Nigeria, creating more value and beneficiation for local communities where they are sourced, ” he said.

Reports says that the minister had earlier received members of the House Committee on Solid Minerals who were on oversight visit to his office.

The minister commended the lawmakers for their support in repositioning the mining sector, stressing that boosting the economic profile of Nigeria required joint task by both the executive and legislature.

He acknowledged the significant contribution of sub-nationals to mining development, emphasising that state chairmen of  Mineral Resources and Environmental Management Committee (MIREMCO) and five committee members were nominated by state governments. (NAN)

Continue Reading

Read Our ePaper

Top Stories

NEWS3 hours ago

Insecurity: Govt to Begins Boundary Demarcation Between Benue, Cameroon, others in April 

ShareFrom Attah Ede Makurdi The federal government is to commence the boundary demarcation between Benue, Taraba, Cameroon, Ebonyi and Nasarawa...

NEWS3 hours ago

Gov Alia  Swears in BSIEC Chairman, other Commissioners

ShareFrom Attah Ede Makurdi  The Benue State governor, Rev. Fr. Hyacinth Alia, on Thursday swore in the newly-appointed chairman of...

NEWS3 hours ago

Gov Alia shuns APC National Leadership  Peace moves in Benue, Inaugurates parallel State Secretariat, Excos 

ShareFrom Attah Ede Makurdi The crisis rocking the ruling All Progressives Congress,APC in Benue State, on Thursday took another dimension...

Metro3 hours ago

Wike Approves Deployment of FCTA’s Pioneer Perm. Secs

ShareThe Minister of the Federal Capital Territory (FCT), Mr Nyesom Wike, has approved the deployment of the 10 pioneer Permanent...

NEWS4 hours ago

MTN, Tier-1 Banks’ Stocks Lift NGX Gains by N157bn

ShareRenewed interest in MTN Nigeria, alongside sustained interest in Tier-one banks’ stocks on Thursday further raised the equity market higher...

NEWS4 hours ago

Naira Falls Against Dollar by 0.7%

ShareThe Naira experienced a slight depreciation at the official market, trading at N1,309.39 to a dollar on Thursday. Data from...

dailyasset-greetings dailyasset-greetings
BUSINESS4 hours ago

CBN Unveils New Minimum Capital Requirements For Banks

ShareGives Them 24 months To Recapitalise By Tony Obiechina, Abuja   Days after urging Nigerian banks to expedite action on the...

NEWS4 hours ago

ShareNAFDAC Intercepts Psychoactive Drugs, Bursts Beverage Factories in Southeast The National Agency for Food, Drugs Administration and Control (NAFDAC) has...

NEWS21 hours ago

FCT HOS: Why President Tinubu Extends Atang’s Tenure By 6 Months

ShareBy Laide Akinboade, AbujaPresident Bola Ahmed Tinubu, has approved the extension of Atang Udo Samuel, as the the Head of...

NEWS21 hours ago

FGGC Benin Emerges Winner of 2023 National Senior Secondary Schools’ Debate

ShareBy Tony Obiechina, AbujaThe Federal Government Girls College, Benin has emerged overall winner of the 2023 National Senior Secondary Schools’...

Copyright © 2021 Daily Asset Limited | Powered by ObajeSoft Inc