By Adedapo Adesanya
The African Development Bank (AfDB) has approved $288.5 million loan to help Nigeria tackle the COVID-19 pandemic and mitigate its impact on the economy.
The loan, according to the development finance institution, will bolster the government’s plans to improve response to COVID-19 emergencies, ease the impact on workers and businesses and strengthen the social protection system.
The loan is the bank’s initial response to help mitigate the slump in oil prices and its impact on the national economy, which has affected revenue projects for the year.
Nigeria had in April secured $3.4 billion from the International Monetary Fund (IMF) in emergency financial assistance under the fund’s Rapid Financing Instrument (RFI).
This supports government’s efforts in addressing the severe economic impact of the COVID-19 economic shock and the drastic fall in oil prices, which affected Nigeria’s revenue.
Speaking on this, the bank’s Senior Director for Nigeria, Mr Ebrima Faal said, “The proposed programme will ensure that the fiscal position and the economy are sufficiently supported to weather the COVID-19 shocks, thereby limiting its potential adverse impact on livelihoods and the economy more generally.”
The bank also noted that its active portfolio in Nigeria as of December 2019 comprised 61 operations, with a total commitment of about $5 billion.
The AfDB disclosed this while announcing the approval of Nigeria’s Country Strategy Paper (CSP) 2020 – 2024 by its board of directors.
These active operations include 29 in the public sector, with a commitment of $2 billion. which accounts for 43 percent and 32 non-sovereign operations with a total commitment of $3 billion equivalent to 57 percent of the total portfolio.
The bank said under the CSP, it would deploy a combination of sovereign and non-sovereign financing instruments to support the two priority areas, including investment and institutional support projects, evidence-based analytical work in numerous economic sectors, policy dialogue and provision of advisory services.
It said special focus would be put on supporting the Nigerian private sector, in terms of financing and advisory services, and on public-private-partnership initiatives that would enable innovative, long-term investment in energy, transport and water and sanitation.
Modupe Gbadeyanka