COVID-19: CBN To Inject N1tr Into Economy

THE Central Bank of Nigeria (CBN) on Wednesday announced its decision to increase intervention in local manufacturing and import substitution sector by injecting N1 trillion across all critical sectors of the economy.

The CBN Governor, Godwin Emefiele, who broke the news in Abuja, said the capital injection came two days after the banking sector regulator unveiled a six-point palliative to ameliorate the continued impact of the coronavirus on the economy and supply chains round the globe.

He said the management of the CBN will meet with the Bankers’ Committee on Saturday, to work out the modalities for releasing the funds.

The apex bank also announced N100 billion loan to support the health authorities to ensure laboratories, researchers and innovators work with global scientists to patent and or produce vaccines and test kits in Nigeria to prepare for any major crises ahead.

Emefiele also said an Implementation Committee that will implement the private sector contribution of N1.5 trillion infrastructure funding to link farming communities to markets as agreed at the recently-concluded “Going for Growth” roundtable last week will be set-up next week.

Given the plunge in the price of oil, which dropped to $25 per barrel with its attendant low accretion to oil revenue, the CBN boss directed all Deposit Money Banks to increase their support to the pharmaceutical and healthcare industries.

This was to enhance local drug manufacturing, increase bed count in hospitals across Nigeria, fund intensive care, as well as in training, laboratory testing, equipment and Research & Development.

In addition to the N50 billion soft loans to small businesses announced, Emefiele said the CBN would also increase its intervention by another N100 billion in loan in 2020, to support the health authorities.

According to him, the bank will release details of how the unveiled facilities would be accessed and released, adding that the CBN had also set-up the Financial Markets Situation Room to monitor global markets and advise the Bank on adequate response.

Meanwhile, Emefiele has advised all Deposit Money Banks and other regulated entities in the banking industry to trigger their business continuity plans to ensure that their staff and families are protected, and their operations remain largely undisrupted.

He advised the banks to adhere to the directives, advice and notices from the Federal Ministry of Health, National Centre for Disease Control and other relevant government agencies on national response measures to COVID-19.

To check the spread of the virus, he urged the institutions to ensure regular and appropriate sanitisation of their premises and make available in their locations adequate sanitisation materials and also to discourage large gatherings of staff and customers.

While pledging that the CBN will continue to monitor all developments on the COVID – 19 infection and design appropriate monetary response to protect the people and economy of Nigeria, Emefiele urged that Nigerians take advantage of turning what appeared to be an adversity in the pandemic into an opportunity.

Meanwhile, Chief Executive Officer, Economic Associate, Dr. Ayo Teriba, has said the fallout of Covid-19 may disrupt the economy as a result of budget derailment and naira devaluation.

He said the virus has caused temporary harm, such as supply disruptions, wealth losses, manufacturing services- social distancing, demand disruptions and permanent harms.

Teriba spoke at a forum on the implications of Covid-19 outbreak on the economy organised by the Lagos Chamber of Commerce & Industry.