How CBN, banks' delay in releasing fund hampered Social Housing, others implementation - Osinbajo

VP Yemi Osinbajo at FEC Meeting on Wednesday

VP Yemi Osinbajo chaired NEC meeting

Vice President, Prof. Yemi Osinbajo has given a detailed report of the Economic Sustainability Plan highlighting successful outcomes and problems that has delayed an even better implementation of the N2.3 trillion post Covid-19 stimulus package.

Osinbajo spoke  in a presentation at the ongoing Mid-term Ministerial Retreat of the Federal Government on Monday in Abuja presided over by President Muhammadu Buhari.

The presentation was later described as Tour De Force by the AfDB President Dr. Akinwunmi Adesina who also spoke.

The VP disclosed that where it not that the President acted in time to set up the Sustainability Plan, the economic pains associated with COVID-19 would have been deeper and lasted longer.

Dishing out facts and figures of the achievements of the Post Covid-19 stimulus, the VP lamented that the CBN and the banks have delayed in releasing much of the funds causing implementation delays in the Agric, Solar Power and Social Housing sectors.

Under the MSME, the Economic Sustainability Plan has resulted into 1.1m beneficiaries under the N75N ESP Survival Fund for MSMES.

This includes 459,000 beneficiaries of the Payroll support for 3 months, 293k transport workers and artisans who were beneficiaries of a one-off grants, 244,000 MSMES that benefitted from the CAC Formalization Scheme and 82,000 businesses that received one-off grants under the MSMES Grants Scheme.

The VP also spoke of progress in the Agric sector under the ESP including N471bn allocated as loans for farmers across 14 Crop Value Chains, Beef Production, Aquaculture and Poultry Farming.

But he lamented that only N14bn of the sum allocated has been released by the banking system: CBN and the commercial banks.

“Of the N471bn, so far only N14bn is disbursed to commercial banks and is yet to be utilised by farmers due to late release for the 2021 wet farming season, ” according to the VP.

He had a similar regret regarding the Social Housing programme of the ESP where very low cost, mass affordable housing was planned-300,000 across the country.

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The VP said “there are continuing delays in the disbursements of funds from the CBN. The Debenture Agreement for N200 billion with the CBN which represents bulk of the financing was agreed on 22nd April and has been signed by all parties. However disbursement is yet to take place.

“There was a similar lamentation when the VP reviewed the Solar Power Naija programme of the ESP where 5m solar power connections are planned.”

This programme, he said, will increase energy access to 25 million Nigerians.

Already he disclosed that 704,000 Solar connections are certainly underway now and another 600,000 connections is in the offing.

“But the 5m Solar Connections target is being delayed because while N140bn was allocated through the CBN to facilitate, only N7B of that has been disbursed.

“Unwillingness of CBN to disburse funds, risk aversion of Public and private financial institutions particularly for Power projects,” were among challenges militating against a faster speed of implementation,” he said.

The VP said with the Sustainability Plan in place, revenues improved despite oil production issues, while macroeconomic indices are trending in the right direction.

“Besides there has been a rebound in a number of sectors like Transport that had risen by 77%, Hospitality by 2%, Education 1%, Real Estate 4%, Trade 23% and construction by 4%,” he said.

The VP noted that CBN reports indicated disbursements of a total of N798bn to 3.9m small holder farmers under the Anchor Borrowers Programme, N134B to 38,140 beneficiaries in soft agric and small business loans and grants, and a total of N1trillion to 269 real sector projects and another N103bn disbursed to 110 health care projects.

Osinbajo said if not for good policies, the Nigerian economy would have been worse off than most economies who are now struggling with the negative impacts of COVID-19.