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Nigeria, other African countries vowed to protect most vulnerable from impact of high food, energy prices

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4 years ago

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Nigeria and other African countries have agreed to protect the most vulnerable in the society in their various countries. The agreement was reached at the African caucus meeting with the International Monetary Fund Managing Director. A statement by the IMF said “We agreed that the top priority must be to protect the most vulnerable households from the impact of high food and energy prices. But the external shock is hitting the continent at a time when most countries have limited fiscal space, with high debt vulnerabilities and increased risks. In this challenging context, targeted, temporary, and transparent support to vulnerable households using and further developing social safety nets would be the most appropriate solution.

“For this effort to succeed, governments in the region, the international community, and the private sector should make concerted efforts to mobilise revenue and additional financing to support the recovery and implement needed reforms to promote inclusive and sustainable growth, achieve diversification, tackle the climate crisis, and transition to a green economy. The IMF has been playing its part and reformed its concessional lending toolkit for low-income countries to provide greater flexibility to the access levels. It provided emergency financing to countries with urgent balance of payments needs, debt service relief under the Catastrophe Containment and Relief Trust (CCRT) to the most vulnerable countries and enacted an historical Special Drawing Rights (SDR) allocation. The SDR allocation boosted liquidity and reserves around the world. About US$34 billion were allocated to countries in Africa, equivalent in some countries to as much as 6 percent of GDP.

“The IMF has just established a Resilience and Sustainability Trust, which will be operationalised later this year, funded by SDRs voluntarily channeled from donor countries. It will complement the IMF’s existing lending toolkit by providing longer-term affordable financing to address longer-term challenges, including climate change and pandemic preparedness. The ACG welcomed initial pledges of about $40 billion toward financing the RST, and encouraged other contributors to make additional pledges to ensure the RST is well-positioned to support African countries to address their long-term challenges and build resilience.

“The group also underscored the need to address rising debt vulnerabilities of developing countries, particularly in Africa and find effective ways to alleviate the weight of the debt service. It also stressed the need to continue working together to strengthen the debt resolution architecture, including by improving the Common Framework for debt treatments and technical assistance within the Multipronged Approach (MPA) to address the remaining capacity requirements. Our discussions on Africa’s challenges and prospects for recovery have been very fruitful. Today the green shoots of the recovery that started in 2021 are threatened by the war in Ukraine at a time when the war on COVID-19 is still not over. Vaccination rates on the continent remain low and uneven, although some progress has been made in recent months. At 13.2 percent of its population, sub-Saharan Africa remains the region with the lowest vaccination rates in the world, and at 28.1 percent, North Africa’s average rate is also still below the world average.

“The surge in commodity prices triggered by the war in Ukraine has destabilised global commodity markets, exacerbating both inflationary pressures and food security concerns, especially for the most vulnerable who are already scarred by the pandemic. Several countries in North Africa and the Sahel are among the most vulnerable in the world to price increases or shortages of wheat since they are highly dependent on imports from Russia and Ukraine. Although the continent’s fuel and commodity exporters will experience a windfall gain, the positive fiscal impact could be largely offset by additional energy and food subsidies. In contrast, high food and energy prices are straining commodity importers’ external and fiscal balances. Capital flows are also likely to be disrupted.

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Economy

Nigeria champions African-Arab trade to boost agribusiness, industrial growth

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3 days ago

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December 5, 2025

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The Arab Africa Trade Bridges (AATB) Program and the Federal Republic of Nigeria formalized a partnership with the signing of the AATB Membership Agreement, officially welcoming Nigeria as the Program’s newest member country. The signing ceremony took place in Abuja on the sidelines of the 5th AATB Board of Governors Meeting, hosted by the Federal Government of Nigeria.

The Membership Agreement was signed by Eng. Adeeb Y. Al Aama, the CEO of the International Islamic Trade Finance Corporation (ITFC) and AATB Program Secretary General, and H.E. Mr. Wale Edun, Minister of Finance and Coordinating Minister of the Economy, Federal Republic of Nigeria. The Agreement will provide a strategic and operational framework to support Nigeria’s efforts in trade competitiveness, promote export diversification, strengthen priority value chains, and advance capacity-building efforts in line with national development priorities. Areas of collaboration will include trade promotion, agribusiness modernization, SME development, businessmen missions, trade facilitation, logistics efficiency, and digital trade readiness.

The Honourable Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, called for deeper trade collaboration between African and Arab nations, stressing the importance of value-added Agribusiness and industrial partnerships for regional growth. Speaking in Abuja at the Agribusiness Matchmaking Forum ahead of the AATB Board of Governors Meeting, the Minister said the shifting global economy makes it essential for African and Arab nations to rely more on regional cooperation, investment and shared markets.

He highlighted projections showing Arab-Africa trade could grow by more than US$37 billion in the next three years and urged partners to prioritize value addition rather than raw commodity exports. He noted that Nigeria’s growing industrial base and upcoming National Single Window reforms will support efficiency, investment and private-sector expansion.

“This is a moment to turn opportunity into action”, he said. “By working together, we can build stronger value chains, create jobs and support prosperity across our regions”, Edun emphasized. “As African and Arab nations embark on this journey of deeper trade collaboration, the potential for growth and development is vast. With a shared vision and commitment to value-added partnerships, we can unlock new opportunities, drive economic growth, and create a brighter future for our people.”

Speaking during the event, Eng. Adeeb Y. Al Aama, Chief Executive Officer of ITFC and Secretary General of the AATB Program, stated: “We are pleased to welcome Nigeria to be part of the AATB Program. Nigeria stands as one of Africa’s most dynamic and resilient economies in Africa, with a rapidly expanding private sector and strong potential across agribusiness, energy, manufacturing, and digital industries. Through this Membership Agreement, we look forward to collaborating closely with Nigerian institutions to strengthen value chains, expand regional market access, enhance trade finance and investment opportunities, and support the country’s development priorities.”

The signing of this Agreement underscores AATB’s continued engagement with African countries and its evolving portfolio of programs supporting trade and investment. In recent years, AATB has worked on initiatives across agribusiness, textiles, logistics, digital trade, export readiness under the AfCFTA framework, and other regional initiatives such as the Common African Agro-Parks (CAAPs) Programme.

With Nigeria’s accession, the AATB Program extends it’s presence in the region and adds a key partner working toward advancing trade-led development and fostering inclusive economic growth.

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Economy

FEC approves 2026–2028 MTEF, projects N34.33trn revenue 

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3 days ago

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December 4, 2025

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Federal Executive Council (FEC) has approved the 2026–2028 Medium-Term Expenditure Framework (MTEF), a key fiscal document that outlines Nigeria’s revenue expectations, macroeconomic assumptions, and spending priorities for the next three years. The approval followed Wednesday’s FEC meeting presided over by President Bola Tinubu at the State House, Abuja. The Minister of Budget and Economic Planning, Senator Atiku Bagudu made this known after the meeting.

The Minister said the Federal Government is projecting a total revenue inflow of N34.33 trillion in 2026, including N4.98 trillion expected from government-owned enterprises. Bagudu said that the projected revenue is N6.55 trillion lower than earlier estimates, adding that federal allocations are expected to drop by about N9.4 trillion, representing a 16% decline compared to the 2025 budget.

He said that statutory transfers are expected to amount to about N3 trillion within the same fiscal year. On macroeconomic assumptions, FEC adopted an oil production benchmark of 2.6 million barrels per day (mbpd) for 2026, although a more conservative 1.8 mbpd will be used for budgeting purposes. An oil price benchmark of $64 per barrel and an exchange rate of N1,512 per dollar were also approved.

Bagudu said the exchange rate assumption reflects projections tied to economic and political developments ahead of the 2027 general elections. He said the exchange rate assumption took into account the fiscal outlook ahead of the 2027 general elections.

The minister said that all the parameters were based on macroeconomic analysis by the Budget Office and other relevant agencies. Bagudu said FEC also reviewed comments from cabinet members before approving the Medium-Term Fiscal Expenditure Ceiling (MFTEC), which sets expenditure limits. Earlier, the Senate approved the external borrowing plan of $21.5 billion presented by President Tinubu for consideration The loans, according to the Senate, were part of the MTEF and Fiscal Strategy Paper (FSP) for the 2025 budget.

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Economy

CBN hikes interest on treasury Bills above inflation rate

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3 days ago

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December 4, 2025

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The spot rate on Nigerian Treasury bills has been increased by 146 basis points by the Central Bank of Nigeria (CBN) following tight subscription levels at the main auction on Wednesday. The spot rate on Treasury bills with one-year maturity has now surpassed Nigeria’s 16.05% inflation by 145 basis points following a recent decision to keep the policy rate at 27%. 

The Apex Bank came to the primary market with N700 billion Treasury bills offer size across standard tenors, including 91-day, 182-day and 364 day maturities. Details from the auction results showed that demand settled slightly above the total offers as investors began to seek higher returns on naira assets despite disinflation.

Total subscription came in at about N775 billion versus N700 billion offers floated at the main auction. The results showed rising appetite for duration as investors parked about 90% of their bids on Nigerian Treasury bills with 364 days maturity. The CBN opened N100 billion worth of 91 days bills for subscription, but the offer received underwhelming bids totalling N44.17 billion.

The CBN allotted N42.80 billion for the short-term instrument at the spot rate of 15.30%, the same as the previous auction. Total demand for 182 days Nigerian Treasury bills settled at N33.38 billion as against N150 billion that the authority pushed out for subscription. The CBN raised N30.36 billion from 182 days bills allotted to investors at the spot rate of 15.50%, the same as the previous auction.

Investors staked N697.29 billion on N450 billion in 364-day Treasury bills that was offered for subscription. The CBN raised N636.46 billion from the longest tenor at the spot rate of 17.50%, up from 16.04% at the previous auction.

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