Government and institution measures in response to COVID-19.
Government and institution measures in response to COVID-19.
Return to homepage | Last updated: 28 October, 2020
The Central Bank of Nigeria has set out a number of measures to tackle the impact of the coronavirus, including establishing a fund to support the country's economy (of 50 billion naira; i.e. EUR 121 million), targeted at households and micro and small enterprises. The interest rate has also been cut, a moratorium has been announced on principal repayments for CBN intervention facilities and tax measures are being taken.
Economic stimulus measures
(e.g. loans, moratorium on debt repayments…)
- On 16 March, the Central Bank of Nigeria announced new measures:
- A 1 year extension of a moratorium on principal repayments for CBN intervention facilities;
- The reduction of the interest rate on intervention loans from 9 percent to 5 percent;
- Strengthening of the Loan to Deposit ratio policy (i.e. stepped up enforcement of directive to extend more credit to the private sector)
- Creation of NGN50 billion target credit facility for affected households and small and medium enterprises
- Granting regulatory forbearance to banks to restructure terms of facilities in affected sectors
- Improving FX supply to the CBN by directing oil companies and oil servicing companies to sell FX to the CBN rather than the Nigerian National Petroleum Corporation
- Additional NGN100 billion intervention fund in healthcare loans to pharmaceutical companies and healthcare practitioners intending to expand/build capacity
- Identification of few key local pharmaceutical companies that will be granted funding facilities to support the procurement of raw materials and equipment required to boost local drug production.
- N1 trillion in loans to boost local manufacturing and production across critical sectors.
- The CBN has adopted a unified exchange rate system for Inter-Bank and parallel market rates to ease pressure on FOREX earnings as oil prices continues to plummet.
- CBN adopts the official rate of NGN360 to a dollar for International Money Transfer Operators rate to banks.
- For on-lending facilities financial institutions have been directed to engage International development partners and negotiate concessions to ease the pains of the borrowers.
- Provision of credit assistance for the health industry to meet the potential increase in demand for health services and products "by facilitating borrowing conditions for pharmaceutical companies, hospitals and practitioners".
- The crude oil benchmark price was also reduced from USD 57 to USD 30.
- The Central Bank pledged to pump NGN 1.1 trillion (USD 3 billion) into critical sectors of the economy.
- Commencement of a three month repayment moratorium for all TraderMoni, MarketMoni and FarmerMoni loans
- Similar moratorium to be given to all Federal Government funded loans issued by the Bank of Industry, Bank of Agriculture and the Nigeria Export-Import Bank.
- Some restrictions on exportation of masks have been implemented.
- Authorities are considering a wide range of COVID-19 support measures, including reductions of customs duty and customs audits but such measures are not officially announced
- No changes to Customs requirements as at 31 March 2020.
- Extension of filing due date for Value Added Tax (VAT) from the 21st day to the last working day of the month, following the month of deduction.
Other measures and sources
- The Federal Government revises planned spending in the 2020 budget with an increase of about ₦0.23 trillion in expenditure and a 31% decrease in revenue.
Suspension of new electricity tariffs:
- On April 1st, the Nigerian Electricity Regulatory Commission (NERC) suspended the payment of the new electricity tariffs scheduled to commence on 2 April, citing poor electricity supply, wide metering gap and the impact of the COVID-19 pandemic. The National Assembly recently postponed the effective date of the new tariff to the first quarter of 2021.
- On October 11, NERC suspended the Multi Year Tariff Order (MYTO) 2020 for the Electricity Distribution Licensees for 2 weeks.
NIS payment waiver for visitors affected by travel ban.
- On 16 April, Nigeria Immigration Service (NIS) announced the grant of payment waiver to visitors / migrants affected by the travel ban and the closure of international airports. Affected persons are expected to reschedule their flights and travel within a week of the suspension of the restriction.
- Lagos State Government reverts annual land use charges to pre-2018 rates.
Taxpayers in Nigeria need to consider the impact of the coronavirus (COVID-19) pandemic on their businesses and in particular the expected increase in debt default rates, cancellations of contracts or “no-shows”.
Main sources of information:
- Nigeria: Tax relief, responding to coronavirus (COVID-19)
- Nigeria introduces tax and economic measures in response to COVID-19 pandemic
- National Assembly
- Central Bank of Nigeria
- Federal Ministry of Information and Culture
- The Nigerian Electricity Regulatory Commission
- FIRS Notice on Filing - Updates in light of Covid-19 - published March 2020
- Nigeria Security Exchange (PDF 666 KB)
- Nigerian Immigration Service
- COVID-19: Delta waives interest, penalties on tax
Recovery Plan Overview
- Prevent business collapse and ensure liquidity
- Use of labour intensive methods to retain or create jobs in key economic areas
- undertake jobs that enhance growth and create infrastructural investments in roads, bridges, solar power, and communications technologies
- Promote manufacturing and local productions at all levels and curb unnecessary demand for foreign exchange to stem the pressure on exchange rate
- Protect the very poor and most vulnerable through pro-poor spending
Key measures – Real sector
- ₦634.98bn for the creation of 5 million jobs in the agricultural sector while boosting agricultural production and guaranteeing food security.
- ₦317.29bn for mass housing strategy divided into two tracks. Track 1 will involves building of 300,000 homes across the country while Track 2 will leverage existing institutions to build additional 25,515 affordable homes across the country in 12 months.
- ₦240bn to create 250,000 jobs in the energy sector while providing solar power to 5 million households by 2023.
- ₦50bn for direct labour in National Infrastructure Projects to create jobs for youths in relevant priority sectors.
- Launch of programme to create jobs in digital outsourcing.
- ₦90bn for the launch a national programme to promote domestic use of CNG and support the creation of 1 million jobs.
- ₦23.4bn to support the creation of 1 million jobs through the conversion of 30 million homes from dirty fuels (kerosene, charcoal and diesel) to LPG and achieve emissions reduction in greenhouses gases while also applying LPG in other sectors such as agriculture, power generation, transport, industry and technology.
- ₦15bn to sustain 300,000 jobs in 100,000 MSMEs by guaranteeing off-take of identified priority products.
- ₦260bn to establish the SME Survival Fund to sustain at least 500,000 jobs in 50,000 SMEs for 3 months.
- ₦350bn to support the creation jobs in priority sectors using BOI, NEXIM and other national development banks as fulcrums.
- ₦60bn to create 296,000 jobs in the construction and rehabilitation of roads in the 6 geo-political zones of the country through to use of local resources.
- ₦198.94bn to develop a robust health system with the capacity to withstand shocks.
- ₦10.29bn to fast-track the implementation of the National Water Supply, Sanitation and Hygiene programme.
- ₦87.06bn to Increase support to vulnerable individuals and households in the context of COVID-19.
- ₦27bn to save existing aviation industry organisations and jobs, through a targeted stimulus package and fast track the establishment of a private sector driven national carrier.
- ₦144.12bn for the establishment of an economically viable Science and Innovation ecosystem in Nigeria.
- ₦2.39bn to strengthen the national capacity to manage immigration, correctional facilities and public safety post-COVID-19.
- ₦6bn to establish a programme to organise artisanal miners and develop the mineral value-chain in 6 geo-political zones.
- ₦15bn to fast-track the implementation of the National Digital Switch Over Programme.
- Agriculture, Housing, Energy, Youth & Women Development, Technology, Infrastructure/ Construction, MSMEs, Health, Aviation, Science and Technology, Immigration, Mining, Sanitation and Utility, Security and Digital.
Key Measures – Fiscal & Monetary Sector
- Mobilise resources to stimulate the economy and fund projects in the Economic Sustainability Plan.
- Fiscal measures to safeguard oil revenues
- Fiscal measures to mobilise and preserve non-oil revenue by maximizing government revenues and optimising expenditures
- Fiscal measures to reduce non-essential spending by streamlining all government expenditure and eliminating non-essential items
- Support the economy using monetary measures.
- Mobilise external funding and seek debt relief.
- Support financial viability of States.
- Secure appropriate legislative basis for actions to achieve economic sustainability.
- All Sectors of the Nigerian economy, Government.
Key Measures – Implementation
- Establishment of clear priorities
- Articulation of detailed action plans in each sector
- Clarity in time-frame of projects
- Stipulation of desired results and outcomes
- A deliberate strategy to source materials locally
- Use of private sector agents with track record of delivery or meeting project requirements
- Collaboration between public and private sector to measure results
- Adoption of clear accountability framework and monitoring mechanism
- Active oversight by Economic Sustainability Committee
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