The pain, the torment, the torture…
The government is making some expensive decisions that Nigerians probably wouldn’t like
Good morning, Big Brains. Nothing matches that Friday feeling so cheers to that! I’m sad to let you know that Nigerians are still using the word steeze, just like the Nigerian government is still borrowing money that is yet to be publicly accounted for. Anyways, let’s get into it.
- Margaret
Word count: ~1,000
Reading time ~4 mins
Let’s get into today’s edition:
Government asks for 18-month extension of $800 million poverty relief loan
Petrol Price Surges by 223% to ₦770 Per Litre
Ogun state enforces new measures to protect school kids from cholera
The Big Deal
Government asks for 18-month extension of $800 million poverty relief loan
The federal government is slowly becoming that friend who is always in need of urgent 2k or in this case, urgent $800 million.
In 2021, the World Bank approved an $800 million loan to be disbursed to Nigeria at a time when former president Muhammadu Buhari was thinking about removing the fuel subsidy. The loan was supposed to fund a relief programme for less privileged Nigerians after the subsidy removal. But Buhari backed down on his subsidy removal plans so the loan was delayed.
On May 29, President Tinubu did his thing and finally removed subsidy. Only 39.38% of the entire loan has been released to Nigeria since then, leaving a pending balance of about $485 million.
According to the federal government, about three million vulnerable households have benefited from the loan.
The loan was supposed to be repaid in June 2024, but Nigeria has asked for an 18-month extension to repay the loan to boost the National Social Safety Net Program-Scale Up.
The government also added that improving the project is important for them to provide temporary cash transfer support to the people affected by high inflation caused by the fuel subsidy removal and other reforms the government has imposed.
The NASSP-SU project in question, was approved on December 16, 2021, and started on January 30, 2023. The government planned to use this loan for a monthly cash transfer program to assist people affected by the president’s recent changes.
But the programme hit a roadblock due to an investigation into alleged mismanagement by the Ministry of Humanitarian Affairs and Poverty Alleviation. With the loan extension, the government plans to restructure the program.
Why is this a big deal?
The extension of this $800 million loan came with some extra charges. The government will be charged 1.65% interest fee on the first repayment of the loan and they will also be charged an additional 3.40% interest rate on the second payment, including other charges that are bound to increase with time.
These charges will add up and put more pressure on the country’s economy. With the existing economic challenges, including high inflation and low revenue generation, Nigeria's ability to repay its growing debt is declining every day and the World Bank’s interest rate is increasing everyday too.
So far, not many Nigerians know anybody that has benefited from the programme. Judging by the history of funds mismanagement related to this programme, we can only hope that this loan extension will not be another corruption scheme that will affect the entire country.
Petrol Price Surges by 223% to ₦770 Per Litre
We don’t know what is rising faster these days, Ayra Starr’s monthly listeners or fuel price in Nigeria.
The National Bureau of Statistics (NBS) has released a report that confirms that the average price of petrol increased by 223.21% to around ₦770 per litre in May 2024, ridiculously higher than the ₦238.11 per litre it was sold for in May 2023.
According to the report, the prices are even higher in some states. Jigawa State had the highest petrol price at ₦937.50 per litre, followed by Ondo at ₦882.67 and Benue at ₦882.22.
Lagos, Niger, and Kwara had the lowest petrol prices, with Lagos at ₦636.80, Niger at ₦642.16, and Kwara at ₦645.15.
What’s FG doing about this?
So far, not much. The price of fuel is affected by the subsidy removal and the current economic state of the country so we don’t expect the prices to fall anytime soon, except if President Tinubu wakes up on the right side of his bed and puts the subsidy back in place. The $800 million loan is one of the few measures the government has explored to provide some sort of relief to help Nigerians deal with the impact of the subsidy removal, but we can’t say that has been very helpful so far. But the restructuring of the project may come with more benefits for Nigerians.
Ogun state enforces new measures to protect school kids from cholera
With the cholera disease spreading fast in different parts of the country, Ogun state is putting the kids first. The state's Commissioner for Education, Science, and Technology, Prof. Abayomi Arigbabu, said they have put preventive measures in place to control the disease in schools.
Since Wednesday when schools resumed from the mid-term break and the Eid-el-Kabir holiday, schools in Ogun State have been following these measures as instructed by the commissioner.
These measures include giving health talks on cholera prevention to students and staff, providing information on symptoms, how the disease spreads, proper handwashing, and safe drinking water practices.
Arigbabu also mentioned that food vendors who sell to school kids must now get letters from health facilities to confirm that their food is safe to eat.
We expect other states like Lagos, Bayelsa, Zamfara and Cross River who have the highest number of suspected and confirmed cases to take similar action soon.
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great read