The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, said at a briefing on fiscal stimulus measures in response to COVID-19 pandemic and oil prices fiscal shock in Abuja on Monday.
Ahmed explained that the government applied for $2.5 billion from the IMF on behalf of the states and Federal Government.
She added that the Federal Government had sought $1.5 billion, while one billion dollars would go to the states from the IMF request.
According to her, $1 billion is also being expected from the AfDB.
Ahmed disclosed that the IMF’s COVID-19 Rapid Credit Facility would be drawn from Nigeria’s existing holdings with the World Bank Group and International Monetary Fund.
She said that the loan would not be tied to any conditionalities, adding, however, that it was important to also clarify that Nigeria did not intend to negotiate or enter into a formal programme with the IMF at this time or in the foreseeable future.
Ahmed stated that though minimum of six weeks was required to process the funds, the government would do everything possible to access it within two to three months in order to use it in good time for what it was meant for.
The minister also announced that President Muhammadu Buhari has approved the withdrawal of $150 million from the Nigeria Sovereign Investment Authority (NSIA) Stabilization Fund to support the June 2020 allocations nationwide.
“Mr. President has also approved that the Federal Ministry of Finance, Budget and National Planning should engage with the CBN to agree on a Debt and Interest Moratorium for States on Federal Government and CBN-funded loans, in order to create fiscal space for the States, given the projected shortfalls in FAAC allocations.
“Accordingly, once monthly average FAAC receipts fall below a specific threshold, interest and capital payments by States shall be suspended till monthly average FAAC receipts exceed the threshold.
“The details of this Moratorium will be expeditiously worked out with a view to submitting the final proposals for Mr. President’s guidance and final approvals,” she said.
Ahmed said that the fund was also to address these emerging fiscal risks that the pandemic had caused.