Alongside talk of the coronavirus, all citizens seem to hear nowadays is a deluge of cash chasing the cause. There seems to be plenty of money without identified projects and targets. Amid this comes the ear-jangling disclosure by the Minister of Finance and National Planning that Nigeria is seeking a loan of $6.9 billion for the same coronavirus cause. Hello?
Central Bank governor, Godwin Emefiele put together a team that has raised approximately N21 billion by 6 April to support the government’s effort on coronavirus management. Several private sector players have also contributed. The Coalition Against Covid19 (CaCovid) will raise public awareness, support healthcare professionals, institutions and governments as well as mobilise private-sector leadership and resources. CaCovid will build and equip medical tents as testing, isolation and training centres as well as recruit personnel to tend the sick.
On Monday, 06 April 2020, CaCovid announced a cash taking of N21.5 billion from 50 donors.
On the debit side of the ledger, the Federal Government claimed to have disbursed N3 billion initially to beneficiaries of its conditional cash transfer scheme as a palliative for the corona-induced lockdown. Within a week, Information Minister Lai Mohammed claimed the government disbursed N100 billion nationwide. He did not state the number of beneficiaries, except that the distribution was based on existing records.
Juxtaposing the efforts of CaCovid and the Federal Government’s expenditure pattern and amounts points to a huge deficit. While the team led by the Emefiele is building cash reserves the slow and steady way and through collaboration and engagement, the Federal Government is spending like a man at a casino. No accountability and no proper ledger in documenting the expenditure. N100 billion in a week?
Enter the familiar debt lane of the federal government. Finance Minister Zainab Ahmed announced 6 April that the Federal Government would borrow $6.9 billion from multilateral lenders as funding for efforts to stop the spread of the coronavirus. The loans will come as $3.4 billion from the International Monetary Fund, $2.5 billion from the World Bank and $1 billion from the African Development Bank.
The federal government will also release $150 million from the Sovereign Wealth Fund to assist state governments with revenue.
The rationale? According to the Finance Minister: “The intervention is vital to create fiscal space for states as well as the federal government to enable all of us to deal more adequately with the health challenges and economic impact of the crisis.”
What will these loans tackle specifically? Nigeria currently spends 25 percent of its resources on debt servicing and only 5 percent on health. The additional debts will enter the books in the name of health, but there are no clear projects and programmes yet. How much of it will go into health?
The federal government needs to now articulate a SMART programme for managing coronavirus. It should be strategic and specific, be measurable, achievable, realistic yet ambitious and give a time frame. For instance, what is the tenor of the proposed loans? For how much longer after coronavirus must have left these shores would we be confronted with loan repayment?
We do not support additional loans given where we stand with loans as a nation.
Rather, we endorse CaCovid collaboration. We urge the partners to look beyond tents and consider building more permanent structures. They should equip them adequately for the long haul given the very low base of the country in health infrastructure.
Ca-Covid builds on goodwill, good citizenship and patriotism. Partners and contributors are chipping in for a good cause. They are keen on remedying the poor state of things and want the best for Nigeria.
We believe that once they name good projects and commence execution, even more companies and individuals will join. They can look to the Muson Centre model executed by the Musical Society of Nigeria with the support of Corporate Nigeria. In project execution, they could borrow the stake holding paradigm initiated by NLNG and now adopted by the oil majors. States and geopolitical zones should bid for the projects with equity in various forms.
We could just have a citizen-led healthcare infrastructure funding paradigm that can and should outlive Covid-19.
