Nigeria’s adoption of the Central Bank Digital Currency (CBDC) or the eNaira and its supporting technology or block chain, can increase the country’s GDP by $29 billion over the next 10 years. President Muhammadu Buhari has said. The president made this declaration on Monday when he launched the eNaira in Abuja. With the introduction of the eNaira, the government would be able to send direct payments to citizens eligible for specific welfare programmes as well as foster cross border trade, the president noted in a statement issued by his spokesman, Femi Adesina. He said that CBDCs, together with digital innovations, can foster economic growth through better economic activities, increase remittances, improve financial inclusion and make monetary policy more effective. Justifying his reasons for approving the development and ultimate introduction of the eNaira, Buhari said: ‘In recent times, the use of physical cash in conducting business and making payments has been on the decline. This trend has been exacerbated by the onset of the COVID-19 pandemic and the resurgence of a new digital economy.
Continuing, he noted that “the need for urgent action is even more pressing if we take account of the fact that we are now part of the African Continental Free Trade Area which calls for actions to position the economy to benefit from the opportunity that this regional integration grouping presents while at the same time protecting our industries and businesses from unfair competition.” The President took the opportunity to explain the new medium-term National Development Plan, saying, “growth figures are meaningless if they do not translate to good-paying jobs and improved standard of living for our people. The question, of course, I insist, that must be answered regarding all our policies, is what they mean for creation of wealth and human capacity development. The new plan incorporates aspects of the National Poverty Reduction with Growth Strategy which was articulated as a guide towards achieving our poverty reduction target. The starting point for the implementation of the Strategy is the realisation that increased employment is an indispensable tool for reducing poverty”.
According to President Buhari, “the Federal Government is responding to the challenges and opportunities of the moment by articulating forward-looking policies and strategies and implementing a coherent, clear and consistent set of actions in order to achieve our desired objectives. The broad objectives of the new medium-term National Development Plan Plan are to diversify the economy, invest in critical infrastructure, build human capital and improve governance and security. The intention is to achieve broad-based and inclusive GDP growth in order to create 21 million jobs and lift 35 million people out of poverty by 2025. This ambitious but realisable target is consistent with government’s vision of lifting 100 million Nigerians out of poverty in a decade.” Explaining the rationale for government’s policy direction, the President said, “the shock caused by the pandemic (which is still very much with us) was at a time that Nigeria as a developing economy is striving to become a digital economy so that we can leapfrog into the Fourth Industrial Revolution.
“As if this is not a challenge enough, we are also required as a good member of the international community to take steps to mitigate and to adapt to climate change. This is not a simple matter if we bear in mind that we are reliant on oil and gas for revenues and export earnings and yet reducing the use of fossil fuels is the frontline strategy being urged for achieving net-zero carbon emissions by 2050.” President Buhari then listed some of the interventions by government whose results he noted, “are beginning to show although we must admit that there is still much more work to be done especially in the context of our stated priorities to reduce poverty and unemployment which call for urgency.” His words: “The Economic Sustainability Plan adopted in response to the economic crisis caused by the pandemic was centered on tackling and reducing the COVID-19 caseload, restoring growth, protecting and creating jobs, rescuing businesses, and reducing social vulnerabilities.
“These were in addition to the priority actions that were already being taken in the Economic Recovery and Growth Plan to invest in social and human capital, build power, road and rail infrastructure and improve the business environment.” In the MSMEs space, the President said “we were also able through the MSME Survival Fund to support up to 1.1m establishments and individuals. Particularly notable in this regard was the payroll support scheme wherein Government was able to pay salaries to nearly 500,000 employees of MSMEs over a three-month period so that they could remain at work.” In addition to the Survival Fund scheme, President Buhari explained further that “given the critical foreign exchange needs of the economy, we are also providing support to exporters through the Export Expansion Facility Programme and disbursement is ongoing to beneficiaries of the scheme.” He further listed the “labour intensive interventions in agriculture, housing and solar power installations which are still on-going will also boost domestic demand, especially for local products”, as some of the interventions expected to create employment.
Speaking about the Solar Power Naija Project, the President explained that “it is another project of the Economic Sustainability Plan that will lead to the creation of a large number of jobs. We expect up to 250,000 jobs to be created from this effort to connect up to 5 million households to solar power. “This project is particularly important in the context of climate change and in enabling Nigeria to generate renewable electric power against the background of its nationally determined contribution towards net-zero carbon emissions by 2050.” Calling for more public-private partnerships in the transport sector, the President said the efforts of the Federal Government are evident and yielding results. Said President Buhari: “we can all bear witness to the giant strides that are being made in infrastructure across the country. Rail services are already up and running from Abuja to Kaduna; Warri to Itakpe; and Lagos to Ibadan being the most notable. “Similar investment is going on in major roads and bridges like the Lagos-Ibadan, Abuja-Kano, Second Niger Bridge, and East-West Road amongst others. The Road Infrastructure Tax Credit scheme holds great potential as the work done on the Apapa-Oworonshoki Road has demonstrated.”
The President also identified digital economy “as another area with great potential and we are working on several initiatives to boost Business Process Outsourcing which can generate a large number of jobs while also contributing to substantial export earnings.” On her part, Minister of Finance, Budget, and National Planning, Hajiya Zainab Ahmed, commended the partnership with the Nigerian Economic Summit Group over the years and noted the group’s contributions in the development of government’s policies that have and is positively impacting the economy. Earlier in his remarks, the Chairman of the Nigerian Economic Summit Group, Mr Asue Ighodalo made a call on all stakeholders to support the Buhari administration in securing the future of Nigeria.According to him, “Although the challenges confronting us are many, we should not despair. We are not inferior people, let’s get to work urgently, together, we can get our country working.” Also in his remark, a former Prime Minister of Ethiopia, Mr Hailemariam Desalegn Boshe commended the leadership provided by Nigeria in improving the lives of the people through effective policy implementation and inclusive governance. He noted that efforts made by the Nigerian government in securing the lives of the people and improving the economy will go a long way in securing the future of Africa and called on governments across the continent to put the people at the centre of policy choices and implementation. Other dignitaries at the opening session of the summit include State governors, ministers, heads of government agencies, and captains of industry among others.