Keypoints from the ASAP Document

The Accelerated Stabilisation and Advancement Plan (ASAP) document outlines an economic stabilization and intervention plan addressing various macroeconomic challenges and proposing strategic responses to improve Nigeria’s economic conditions. Here are the key points:

Economic Challenges

  1. High Inflation: Current inflation rate is 33.2%.
  2. High MPR Rates: Current MPR (Monetary Policy Rate) is 24.8%.
  3. Currency Depreciation: The Naira depreciated by 95% in 2023.
  4. Low GDP Growth: GDP per capita growth is 0.1% in 2023.
  5. Economic Pressures: Issues include high-interest rates, foreign exchange volatility, reduced consumer purchasing power, and reduced production outputs.

Strategic Objectives

  1. Macro-economic Stability:
    • Moderate inflation
    • Low exchange rate volatility
    • Modest fiscal deficits
    • Sustainable public debt levels
  2. Access to Finance:
    • Affordable finance for businesses to reduce financing risks.
  3. Enabling Operating Environment:
    • Ease of doing business
    • Access to affordable power and infrastructure
    • Job creation and poverty alleviation

Fiscal Intervention Initiatives

  1. Support for MSMEs:
    • N100 billion for youth-owned enterprises.
    • N200 billion for large MSMEs across various industries.
    • N1 trillion for manufacturing stabilization.
    • N150 billion Grow Nigeria Development Fund.
  2. Agriculture:
    • N111 billion for BOI’s Rural Development Programme.
  3. Housing:
    • N250 billion mortgage finance acceleration facility.

Sectoral Fiscal Implications

  • Health and Social Welfare: ₦1.15 trillion to reach 2 million people and power 4,800 PHCs.
  • Agriculture and Food Security: ₦0.5 trillion to improve mechanization and support various farming initiatives.
  • Energy: ₦1.5 trillion for power improvements and debt stabilization.
  • Business Support: ₦2 trillion to support MSMEs and job creation.

Budgetary and Fiscal Outcomes

  • Estimated Additional Spending: ₦6.6 trillion required, representing 2.1% of FYE 24 GDP.
  • Impact on Debt: Increase in debt service and borrowing, with potential adverse effects on leverage metrics.

Implementation Framework

  1. Strategic Direction and Policy Review:
    • Mr. President and the Presidential Economic Coordination Council (PECC) to review and provide guidance.
  2. Effective Monitoring and Recommendations:
    • Monitoring outcomes and comparing them to targets.
  3. Decisive Implementation:
    • Effective coordination through economic management teams and a delivery unit in the Office of the Finance Minister.
  4. Stakeholder Engagement and Communication:
    • Ensuring well-articulated policies and plans.

Key Implementation Considerations

  1. Prioritize Expenditure to Macro-critical Sectors:
    • Accelerate support to MSMEs, which account for nearly 90% of jobs.
  2. Agriculture:
    • National Council for agricultural productivity.
  3. Power Sector:
    • Empower the Power Sector Working Group.
  4. Food Security:
    • Request emergency support from the World Food Programme and convene the National Council of Nutrition.
  5. Temporary Tax Deferments:
    • Defer implementation of certain tax plans like excise duties on beverages, sin tax on sugar-sweetened beverages, and tax on single-use plastics.

This comprehensive plan aims to address immediate economic challenges while setting the foundation for sustainable growth and development in Nigeria.

Download the Full Document Here

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