CBN’s unwillingness to remit funds challenging roll out of Economic Sustainability Plan – Vice President

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Vice President, Yemi Osinbajo disclosed that the unwillingness of the Central bank of Nigeria to disburse funds is slowing down the progress of some sectors of the Economic Sustainability Plan (ESP) including the 5 million Solar Connection Scheme, and agriculture plans for the ESP.

The Vice President disclosed this on Monday, at the two-day Mid-Term Ministerial Performance Review retreat, presided over by President Muhammadu Buhari, where the Vice President delivered the progress report on the ESP implementation.

He also revealed that only N14 billion of the N471 billion as loans has been disbursed to farmers across 14 crop value chains under the ESP.

What the Vice President said

“The 5 million Solar Connections target is being delayed because while N140 billion was allocated through the CBN to facilitate it, only N7 billion of that has been disbursed,” Osinbajo said.

He added that some key challenges of the implementation of the programme include the “Unwillingness of CBN to disburse funds, and the risk aversion of Public and private financial institutions, particularly for Power projects.”

He stated also that the funding delays were noted on the Agric plan of the ESP, adding that only N14 billion of the N471 billion as loans to farmers across 14 crop value chains have been disbursed to commercial banks.

“Even then, that amount is yet to be utilised by farmers due to late release for the 2021 wet farming season,” he said.

He also urged the Central Bank of Nigeria (CBN) to review its strategy on foreign exchange and ensure that the Naira value reflects the market reality, rather than what he described as “artificially low,” deterring investors from bringing foreign exchange into the country.

“As for the exchange rate, I think we need to move our rates to be as reflective of the market as possible. This, in my own respectful view, is the only way to improve supply,” Osinbajo said.

“We can’t get new dollars into the system, where the exchange rate is artificially low. And everyone knows by how much our reserves can grow. I’m convinced that the demand management strategy currently being adopted by the CBN needs a rethink, and that is my view,” the Vice President stated adding also that there must be synergy between the fiscal and the monetary authority.

Recall Nairametrics reported in June that President Muhammadu Buhari praised Nigeria’s effort in exiting the recession, citing the successful execution of the Economic Sustainability Plan, launched by the FG to tackle the effects of the Covid pandemic on the economy.

“The Economic Sustainability Plan, our plan for the covid pandemic, is currently being executed, the plan is primarily focused on the non-oil sector which has recorded phenomenal growth, contributing over 90% to GDP growth in q1 2021,” the President said, adding that although marginal, Nigeria recorded GDP growth over 2 quarters, an evidence of the successful execution of the Economic Sustainability Plan by the federal government.