FG Pledges Adequate Funding For Mass Housing
By Tony Obiechina, Abuja
Toward realising its mass housing target set in the next five years, the federal government has pledged to provide enough funding for the execution of the Family Homes Funds, Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed announced on Monday.
And to ensure that the project does not lack funding, the government has authorized the board and management of Family Homes fund to source for more funds from third party institutions like development finance institutions and the capital market.
The minister who spoke at the inauguration of the Board of Family Homes Funds in Abuja, said “the present administration is committed to the implementation of this Housing Policy through the provision of enough funds for its sustainability in the Medium Term Expenditure Framework for the next five years.”
Although the minister did disclose how much the government would provide for the project she said it “established the Family Homes Funds for the provision of affordable homes for 500,000 Low income Nigerians and the creation of 1.5 million jobs”.
According to her, it is “the President Muhammadu Buhari Administration’s goal of bridging the housing needs gap with the aim of promptly addressing the numerous demands for government interventions in the housing sector.”
In view of the huge amount of money the Family Homes Funds company is expected to raise from the federal government and other financial institutions, the Mrs Ahmed told the board members of the company that government “will require unusual commitment, uncommon focus, experience and determination to succeed. Without doubt, the Federal Government expects results, measurable ones at that.”
She also directed the board and management “to establish top corporate governance culture and a carefully designed internal control mechanisms.”
In her words, “the Family Homes Fund will receive significant amounts of public money, in addition to other capital from development finance institutions and the capital market. It must, therefore, be a reliable steward of resource on your part.”
She said the government also expects the board and management of the company “to be creative, bold and ambitious.”
The housing programme envisaged under the Family Homes Scheme Zainab Ahmed said “is the largest in the history of our nation and if successfully delivered, it has the potential, not to change lives but also to boost Nigeria’s economy.”
The mass housing scheme she pointed out will “serve as a catalyst to attract investors, provide land ownership to citizens at a lower rate and mobilise funds through mortgage finance.”
She lamented that the poor delivery of affordable housing over the last thirty (30) years is, in part, “attributable to lack of co-operation among various agencies tasked with the provision of housing.”
Zainab Ahmed then urged the Family Homes Fund Company team “to seek and build partnerships, and even collaboration. It is quite unlikely that the Fund will achieve the expectations of Mr. President, without partnering the others.”
According to her, the Federal Government expects a financially sustainable Fund. Whilst the initial capital commitment from Government will be useful, the expectation is that the company will raise significant third-party capital to finance the programme.”
Earlier, the Permanent Secretary Special Duties in the Ministry of Finance Dr. Muhammed Dikwa represented by Mr. Denis Chukwu said the inauguration of the board of the FamilyHomes Fund will help bridge the housing needs in Nigeria.
The Homes Fund he said was established in 2016 to provide affordable houses for 500,000. He disclosed that “on Friday, the fund commissioned an estate of housing 650 units at Issele Azagba in delta state.
Chairman of the board and former deputy governor of the Central Bank of Nigeria (CBN) Mr. Suleiman Barau pledged the commitment of the board and management of the Fund to provide leadership given the quality of expertise at the disposal of the team.
On the minister’s directive, Barau assured that the team will first organize a governance seminar for all staff in other to have every member of staff, management and board on the need to have a strong corporate governance structure.
World Bank Announces Ajay Banga as Sole Nominee for President
The World Bank Group’s Board of Executive Directors announced that Ajay Banga, a U.S. national, was the only nominee for the position of the next President of the bank.
This is contained in a statement issued by the World Bank in Abuja on Friday.
“The World Bank Group’s Board of Executive Directors today confirmed that, as announced on Feb.22, the period for submitting nominations for the position of the next President of the World Bank Group closed on Wednesday at 6:00 pm ET. ”
“The board received one nomination and would like to announce that Ajay Banga, a U.S. national, will be considered for the position.
“In accordance with established procedures, the Board of Executive Directors will conduct a formal interview with the candidate in Washington D.C., and expect to conclude the Presidential selection in due course,” the board said.
The News Agency of Nigeria (NAN) reports that in February, US President Joe Biden nominated Banga to lead the World Bank saying that he is “well equipped” to lead the global institution at “this critical moment in history.”
No other country proposed an alternate candidate for the prestigious post.
Banga, 63, was born in India and is a naturalised U.S. citizen.
The former Mastercard Inc. chief, Banga currently serves as Vice Chairman at General Atlantic.
NAN reports that if confirmed, Banga would become the first-ever Indian-American to head either of the two top international financial institutions: the International Monetary Fund and the World Bank.
Banga is expected to replace the current World Bank president David Malpass, who will step down in June, nearly a year before his term is scheduled to expire.
Malpass faced strong criticism over the bank’s commitment to climate action and over his personal views on climate change. (NAN)
Nigeria’s Debt Stock Hits N46trn
Nigeria’s total public debt stock as at Dec.31, 2022 stands at N46.25 trillion (103.11 billion dollars).
This is according to a statement issued by the Debt Management Office (DMO) in Abuja yesterday.
The DMO said the total public debt stock of the country consisted of the domestic and external debts of the Federal Government of Nigeria (FGN) and the sub-national governments.
The sub-national are the 36 state governments and the Federal Capital Territory (FCT).
The comparative debt stock for Dec. 31, 2021 is N39.59 trillion (95.77 billion dollars)
The DMO said in terms of composition, total domestic debt stock stood at N27.55 trillion (61.42 billion dollars), while total external debt stock was N18.70 trillion (41.69 billion dollar).
“Among the reasons for the increase in total public debt stock were new borrowings by the Federal Government and sub-national governments, primarily to finance budget deficits and execute projects.
“The issuance of promissory notes by the Federal Government to settle some liabilities also contributed to growth in the debt stock,” the office said.
It, however, said that on-going efforts by the Federal Government to increase revenue from oil and non-oil sources through initiatives like the Finance Acts and the Strategic Revenue Mobilisation Initiative are expected support debt sustainability.
“Meanwhile, the total debt-to- Gross Domestic Product (GDP) ratio for Dec. 31, 2022 was 23.20 per cent. It indicates a slight increase from the figure of Dec. 31, 2021 at 22.47 per cent.
“The ratio of 23.20 per cent is within the 40 per cent limit self-imposed by Nigeria and the 55 per cent limit recommend by World Bank/International Monetary Fund (IMF).
“It is also within the 70 per cent limit recommend by the Economic Community of West African States (ECOWAS),” it said.
The total public debt stock as released by DMO excludes the N22 trillion Federal Government’s indebtedness to the Central Bank of Nigeria (CBN), through Ways and Means advances.
The Ways and Means advances are presently awaiting securitisation by the National Assembly, and can only be added to the country’s public debt after such securitisation.
Experts Canvass Better Attention to Taxes, Untapped Minerals, others
By Gom Mirian, Abuja
Experts in the research and development sectors have called on the incoming administration to focus on the growth-enhancing sectors in the country rather than relying solely on revenues from crude oil to develop the economy.
The call was made in Abuja at a one-day Leadership and Development Policy Dialogue Series (LDPDS)organized by the African Centre for Leadership, Strategy and Development (Centre LSD)tagged: “Nigerian Debt Profile: Issues, implications, Lessons and Solutions for the Next Administration.” yesterday.
Director portfolio management department of the Debt Management Office (DMO), Mr Oladele Afolabi said there were a lot of linkages and shortfalls in the payment of taxes, especially by companies which is the reflection of the low revenue received in the country.
While urging the next administration to ensure blockage of these linkages, tasked the government to explore untapped mineral resources in the country to generate more revenue since the revenue obtained from crude oil is incapable of developing the economy.
Speaking at the dialogue, a professor of Economics at the University of Abuja, Isa Muhammad said Nigeria spends N97 of every N100 earned or produced on debt service.
According to professor Muhammad, the Nigerian debt service to income ratio has drastically increased from 17% to 97% in ten years (2012-2021).
He said the increase is extremely high compared to the World Bank’s recommended limit of no more than 22.5%.
He said: “In 2022, a deficit of N6. 26 trillion is anticipated as a result of all fiscal activities.
“Debt payment is anticipated to cost N3.61 trillion, with N292.71 billion coming from sinking funds to pay off maturing bonds.
“This is an alarming instance of revenue challenge that, if not handled properly, could result in a problem with the sustainability of debt”, he said.
Professor Muhammad called on the next administration to strengthen government finances, lower the fiscal deficit over time, and adopt revenue and expenditure reform steps in the medium term.
He also called on the next administration to move away from budget deficits as income collections increase.
Earlier in his remarks, the Executive Director of the Centre LSD, Mr Monday Osasah, said dialogue became imperative following the Federal Government (FG), the outcry that Nigeria’s debt sustainability has become threatened owing to the rise in its revenue shortfalls.
He said: “This revenue, unfortunately, is not matched by the high debt servicing burden of the country. According to the Minister of Finance, Nigeria is expected to spend 60% of its total revenue on debt servicing in 2023.
Also, the Head of the National Bureau of Statistics(NBS), Dr Anthony Ayo urged the next administration to step down on the ‘debt-to-GDP ratio as a method of measuring debt sustainability but rather than adopt the ‘revenue-to-GDP approach to achieve effective results.
Mr Osasah said these assertions portend a grave threat to the Nigerian economy, as this depletes the resources available for other national developmental priorities.
He said the dialogue, therefore, presents an opportunity for stakeholders to have a shared understanding of the issues, implications, lessons, and solutions, as well as make recommendations for the next Administration.
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